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Can't Beat the Markets? Here's Your Problem... Andrew Snyder, Editorial Director, The Oxford Club
 It's one of the greatest problems current generations face. And when we're talking strictly about money, I argue it is our greatest problem.
Because it will lead countless investors to a life of mediocrity.
We've all heard it. Most folks have said it. "All I need to do is keep up with the markets and I'll be set."
It's the mantra of most financial advice. Earn the market's average return of something just north of 8% each year and you'll eventually retire comfortably.
It's true and accurate logic. Too bad it's hogwash.
Most folks come nowhere near that critical benchmark.
We've recently become obsessed with a small but telling piece of research. It proves that the average investor has earned nothing close to the stock market's average return over the last generation.
In fact, he's barely kept pace with the worst-performing asset classes.
It's a sad tale...
This graph measures the average investor's annual return over the last two decades versus a wide variety of asset classes.
The fact is, the typical investor earned less than 3% annually over the last two decades - not even a third of what we can historically expect the S&P 500 to return.
A return like that will lead to nothing but mediocrity.
What's the solution?
We argue the solution is behavioral... not structural. In other words, there's no real barrier keeping you or any investor from earning a larger return. The problem, instead, is our own behavior.
Most folks don't understand risk and reward. They don't understand buying or selling psychology. And they certainly don't understand some of the quiet currents that stir the markets (like the manipulation of interest rates).
The solution, therefore, is twofold.
First, you must be wise enough to identify shortcomings. And second, you must adopt a strategy that overcomes those shortcomings.
Our mission at Investment U (the educational arm of The Oxford Club) is to tackle the first solution. But I argue the idea of "education" is a bit of a misnomer. We're more about the delivery of vital, real-world information than educating.
To prove what I mean, take a look at a few of the offerings we debuted over the past year.
The Investment U Bookstore - Sure, it offers essential reading for every investor. But its main focus is to offer fresh ideas. Instead of merely teaching the basics of investing, our self-imposed mandate is to explain the "why" of the idea. We're not just explaining the essentials of dividends, for example, we're leading readers to the pitfalls in the dividend realm that may lead them to mediocrity.
Online Investing Courses - Our growing list of course offerings is our most unique offering. Go to any mainstream financial site and you'll find a plethora of ho-hum educational pieces. They all look at virtually the same subjects in the same way. There's nothing unique. And we argue the path these offerings lead investors down is proof that if everybody is doing it, the best we can expect is mediocrity.
That's why our courses stretch beyond the typical mundane topics. Instead, we focus on explaining and exploring the best moneymaking topics. It's education you can immediately put to use.
The Investment U Conference - While far from new, our annual conference is one of the best "educational" events in the country. Each year, it hosts over two dozen speakers - all charged with explaining the "why" of their best investment ideas. The results have been spectacular. For the details on how you can access our latest event for free, click here.
Again, mediocrity is a curse. It's the result of our biological tendency to follow the herd. We are most comfortable doing what everybody else is doing... no matter the rationale or the result.
To become a successful investor, you must understand that curse. And you must overcome it.
If you want to get rich, you must think and invest differently.
Good investing,
Andrew
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