The Biggest Winners in the Stock Market (Ben Carlson, 7/21/24, A Wealth of Common Sense)
The stock market is hard to beat because picking the winning stocks is hard. Index funds own them regardless.
Winners > losers. Index funds also own the losers, of which there are many.
But the winners more than make up for the losers.
That’s the beauty of the stock market.
Compounding over decade-long periods is like magic. There are no stocks for the long run with crazy 20% or 30% annual returns over 8-9 decades.
From 1926-2023 the S&P 500 was up 10.3% per year so it’s not like the best-performing survivors crushed the market by leaps and bounds.
But those above-average returns compounded over 98 years added up to incredible growth over that time.
That compounding has been magic for the stock market.