90% of people asking this question fit one category: People with almost no real money to invest (<$300K to invest) trying to get rich by trading stocks.
Let’s do some MATH.
Let’s say you have $300k and want to invest it.
You have 2 options:
- Invest in an index fund and get 10% returns on average. Little to no time invested in research.
- Invest the money yourself and actively manage your portfolio. You sink in countless hours studying individual stocks and get 15% returns on average.
90% of active fund managers under-perform indexes in the long run. But for the sake of example, let’s assume you are that bright 10% of overperformers.
To top it off, beating the market by 5% on average over the long run is phenomenal. So option #2 is highly unlikely to hold up, but let’s say you manage to do it.
What are the results?
At the end of the year, instead of growing your portfolio by $30k, you add $45k to your balance sheet.
A measly $15k difference.
And that’s after you spent countless hours “researching” different stocks.
And after assuming that you’re one of those rare investors that actually beat the market.
Unless you have at least $3M or more, it’s not even worth thinking about becoming an “active investor” – you just don’t have enough money to make a difference.
You are not going to get rich by beating the market by 5%.
The only way to get rich is by starting a scalable online business i.e. investing in your own business instead of other people’s business.
When you are pulling tens to hundreds of thousands of dollars each year from your WiFi business, you will “outperform” 99.99% of dudes actively picking stocks.
Remember, you only have so much time in a day.
Would you rather spend it building your own business that sets you free, or watching financial news trying to look for the new new new thing so you can outperform by 5-6%?
Unless you already have millions of dollars to invest, it’s a no-brainer.
You will not get rich trading stocks or crypto. You WILL get rich by starting a business.
Even if you were to manage to double your $100k with active trading, it’s still just $200k. Nothing life changing.
Instead of worrying about “markets” just take out $10-30k (or whatever you have) and dump it all into various WiFi money ideas and see what sticks.
Reinvest whatever you make into your own business because nothing will have a higher return than your own business.
Only when you cannot reinvest any more money in your business – start investing in stocks/crypto/whatever else.
It’s hard to stick through the first 1-3 years as you get the first WiFi biz up and running but once you have your first success, all the pieces start falling into place.
Most are lazy and addicted to getting quick dopamine hits every 5 minutes so they give up in 3 days. Pushing for 1-3 years is hard.
BUT when your first business is making $5-10k a month (usually within 3 years of serious trying) you will be miles ahead of dudes working hard at jobs and “actively investing”.
Hope that answers the question very clearly. Unless you have a decent amount of money, you should NOT be actively investing in the market.
Just use an index fund and use your time for business.
– Harsh Strongman
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