How to Beat the Stock Market, and Why You Probably Canβt Do It
In this blog post, Iβm going to answer the question of how to beat the stock market, my thoughts on how this can be done over a relatively long period of time, and why youβre almost certainly better in an index fund over any lengthy period of time.Β My theory on how to beat the stock market, essentially says that the way you can do this is by picking a small basket of value stocks and holding them over a long period of time, it also blends in some occasional Hyde risk trading strategies, like using News articles to occasionally allocate a portion of your portfolio to hot IPOs, or other risky stocks. The only realistic way I can see someone beating the market over a very long period of time, such as a 30 year period of time, is by getting a big head start right off the bat, and buying the benchmark shortly there after, thereby increasing their overall average annual return. To give you an example of this, say youβre a brand new hedge fund or starting investor, youβve never allocated any capital to an equity, and youβre starting right now on day zero. Read on or subscribe to our blog for additional details and information!
Hereβs my top ten stocks to beat the market with:
- Apple
- Amazon
- Exxon Mobil
- Tesla
- Nvidia
- Baidu
- Alibaba
- McDonaldβs
And a host of other securities, read on or subscribe to our blog for additional details and information.
How to Beat the Stock Market by Buying the Benchmark
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The sky is the limit from here, but so is the ground. Because youβre at zero, if you get any initial like right off the bat, it can easily spiral into annual returns that beat the market. Imagine you put your first trade of your new hedge fund in a 50% gain stock, from a brand new IPO that you get lucky on. A 50% gain right off the bat, means that if you park your money in the benchmark for the next 30 years, that 50% over market gain amount, can annualized out into a 1 to 2% gain increase year-over-year. In essence, you are one lucky trade Can take your annual returns from 8% a year, which she wouldβve had and say a benchmark S&P 500 fund, and turn them into something like a 10 or 11% annual return, when you factor in your initial 50% gain. Now while itβs impossible just about to make 50% right off the bat, this is about the only way I can see someone beating the market over a long period of time, essentially youβre just holding the S&P 500 with a little bit of luck right out of the gates, and if you pull this off youβll be one of the only funds to have ever been in the market over a sustained period of time.
How to Beat the Stock Market Over the Long Term
I first learned this trick through one of my prior trading professors in college. He basically said if youβre having a good year, and say your bonus is dependent on you beating the benchmark, if you start off at 10% in the markets at 4%, you can just buy the benchmark right off the bat, and beat the market. He also said, say you can speculate the market has a down year, and then itβs going to be down 20%. You pull all your clients money out of the market, Parkette in a CD, and you make 2%. If the stock market made -20% he said, and in a given year you made 2%, you definitely should be entitled to some sort of a bonus, as you just beat the market by 20%.
Sources:
- https://medium.com/nori-carbon-removal/how-i-passed-the-securities-industry-essentials-sie-exam-de86529f9feb
- https://www.professionalexamtutoring.com/sie-exam-difficulty/
- https://www.efinancialcareers.com/news/evergreen/seven-tips-for-acing-the-series-7-and-other-financial-exams
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