The Easiest Way to Underperform the Market

Before you go, we thought you'd like these...
Before you go close icon

One of the most important statistics in the investment business is that the vast majority of investors -- professional or otherwise -- underperform a benchmark index like the S&P 500 . Given the limited potential for outperformance and an unlimited amount to charge in fees and expenses, this is a mathematical certainty.

It's bad enough when professional money-managers underperform an index fund, but if you dig deeper, some of the numbers really make you shake your head. In this video, Fool analysts Morgan Housel and Matt Koppenheffer break down just how bad the pros can be.


The Motley Fool's chief investment officer has selected his No. 1 stock for the next year. Find out which stock it is in the brand-new free report "The Motley Fool's Top Stock for 2013." Just click here to access the report and find out the name of this under-the-radar company.

The article The Easiest Way to Underperform the Market originally appeared on Fool.com.

Morgan Housel has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners