alt Hacker News> I’m saying someone pursuing that portfolio will probably end up underperforming an index.
This holds if you consider "underperforming" to be a comparison of expected values.
On the other hand, if you consider "probability of getting a really huge payoff" to be the measure by which the investments are compared, the index fund is the one that looses in the comparison.
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mahemm • yesterday at 3:24 PM
Would you be comfortable using this same logic to invest most of your net worth in lottery tickets/betting on black in a casino? If not, I'd be curious to hear what is different in that for you.
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> if you consider "probability of getting a really huge payoff" to be the measure by which the investments are compared
That’s gambling. You’re truncating the curve below the top. It’s a terrific strategy for middlemen. Its expected value is lower than index investing.