...most of the big gains happen in VERY VERY short windows of stock price jumps, so that if you try to get out when prices are falling and get in as they are rising, it's already too late and you've missed the significant rises...
Yes, timing is all. Sadlement, in my experience it seems to me that, when I make a buy
of a stock at what I reckon is a cheap price, then the whole market takes that as an indication to drop the price of that particular stock, and when I make a sell
of a stock at what I reckon is a high price, then the whole market takes that as an indication to raise the price of that particular stock.
But yes, joking aside, it is a potentially very useful article and for the investor it provides a much-needed and pretty definitive explanation as to why active fund management performance is typically so bad and such a gamble.
It also cuts through all the BS that fund managers are fond of spouting.
Talking of BS in the financial market, if you listened to the audio, and kept
listening after it finished, there's another audio - I think, immediately following - where some idiot with a South African accent talks about the market having a "headwind". The only "wind" about it is the blowhard who is uttering that phrase. If you listen to how he speaks, he has the annoying habit of raising the tone upwards at the end of a sentence, as though he's asking a question rather than making a statement. This can often be a dead giveaway that the person speaking variously lacks certainty/self-confidence, or lacks competence, and/or lacks knowledge of what they are talking about and is thus unconsciously appealing to the listener to accept what they say. It can be like a professional stigma - the sort of thing that will get one rejected when being interviewed for a job (but nobody will tell the applicant that is why they were rejected).
The TV cartoon series of Family Guy
made a somewhat unkind joke about this particular characteristic/habit:
Family Guy - Season: 5 Episode: 5 - Whistle While Your Wife Works (first aired November 2006)
(The "Jillian syndrome".)
In this episode, Peter badly injures his hand while Brian gets a new girlfriend.
When Peter gets hurt and cannot work, his boss tells him that he needs to speed things up.
Brian brings his "idiot" (per Stewie) blonde girlfriend, Jillian (a photographer) home to meet the family. Stewie is not impressed.
Stewie: All right, Brian, you can do this. You can dump her, because once it's done, never again will you have to listen to her talk like [this?] You know, where everything has a [question mark at the end of it?] With an upward [inflection?] At the end of [every sentence?]
Brian: Yeah, I don't know what I was [thinking?] Oh, dammit, now I'm doing it too!