“When ideas fail, words come in very handy.” – Johann Wolfgang von Goethe
This next quote from Warren Buffett explains more clearly than I ever have why most professional money managers don’t really try to beat the index.
“Most managers have very little incentive to make the intelligent-but-with-some-chance-of-looking-like-an-idiot decision. Their personal gain/loss ratio is all too obvious: if an unconventional decision works out well, they get a pat on the back and, if it works out poorly, they get a pink slip. (Failing conventionally is the route to go; as a group, lemmings may have a rotten image, but no individual lemming has ever received bad press.)”
The last bit makes me think of someone watching a video of hundreds of lemmings going over a cliff, pausing the video, and pointing and screaming “THAT ONE RIGHT THERE! WHAT AN IDIOT!”
And finally, we have one of my favourite investing-related quotes with a slight temporal challenge:
“Don't gamble; take all your savings and buy some good stock and hold it till it goes up, then sell it. If it don't go up, don't buy it.” – Will Rogers