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Embrace market efficiency from "summary" of The Little Book of Common Sense Investing by John C. Bogle
To succeed in the investment business, we must embrace market efficiency. This concept is at the core of smart investing. Market efficiency means that the prices of stocks and bonds fully reflect all available information. In other words, the market is always right. Trying to beat the market by picking individual stocks or trying to time the market is a fool's errand. Market efficiency is not about predicting the future or outsmarting other investors. It is about accepting the reality that we cannot consistently beat the market. This may sound counterintuitive, but it is the truth. The evidence is overwhelming that most investors who try to beat the market end up worse off than if they had simply invested in a low-cost index fund. Instead of fighting against market efficiency, we should embrace it. By investing in a broad market index fund, we can capture the market's retu...
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