Monday Morning Millionaire Program vs. the big boys

The big boys (and girls), that is, commercial banks, hedge funds, pension funds, insurance companies and university endowments are staffed by the best money managers, looking for the best investment opportunities, using the best information, the best investment tools, the best investment ideas and the best supporting staff. They manage portfolios ranging from the low millions of dollars to billions of dollars.

Their objective is to beat the market and to beat each other. How well do they do? How well have they done? In the chart below, we can see the 20-year record of the S&P 500 which is an excellent approximation of the history of the market over that time period. Monday Morning Millionaire Program members simply mirror the market minus a minimal transaction cost. (Recently, Wall Street started announcing $0.00 transaction costs.)

Most of the big boys (and girls) have failed to match this record over an extended period.

As the chart below shows, investing in the market has produced an excellent outcome assuming investors don’t shoot themselves in the foot. Many do. Monday Morning Millionaire Program members don’t.

In addition to decent returns, investing in the market has the advantages of continuously quoted prices, absolute liquidity, low transaction costs and excellent broker-provided record keeping. So how do Monday Morning Millionaire Program members do it?