OK. Then in a similar vein, I would like to say that I can guarantee you someone will win the California state lottery in the next month. I can also guarantee you that someone will leave Las Vegas a winner in the next month.
My point? Who cares whether it is possible for something to happen. Most people's have to save and invest for significantly longer than 6 months to get to their retirement goals. If you gamble during that time by daytrading, your expected value is negative, meaning you'll end up with less than you started, when you are supposed to be retiring. Whereas, if you invest (meaning go long on a diversified portfolio), your expected value is positive, meaning the odds are that you will end up with more than you started with.
So I agree, anything's possible, but would you bet your retirement on the lottery or in Vegas? If you would, then you'd be of like mind to daytraders around the world, who believe they can guess a stock's direction more often than no.
BTW, let me give you one more statistic. Most people are risk averse. What that means is that as investors, they are much more likely to take gains before they should have, forgoing a lot more profit they could have made had they held. Conversely, risk averse folks tend to allow losses to mount, when they should have cut their losses early had they been purely rational. This is a statistical fact, which gives most investors the unfortunate personality bias of being a preordained loser if they choose to daytrader over the long term. |
