Success Rate Of Retail Investors

[Wildreamz]

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I think the question about being open to various asset classes and geographies is good food for thought, and I chewed on it for some time.


The kind of out-performance by S&P over STI in the last decade is spectacular. Or if we were to look at the growing price of bitcoin, that is also very spectacular. If Singaporean investors had known this a decade ago, I'm pretty sure all of them would have bought bitcoin and S&P. 

So the question is, how will an investor know which asset class or geography will outperform (or do reasonably well) in the next decade? What kind of knowledge/expertise will that require?

I don't have anything close to an answer for these questions. But if anyone does, I will be very happy to be enlightened.

No one can predict the unpredictable (e.g. the future, where the next asset bubble will be) with any kind of precision. But based on history, stock price performance has the strongest correlation (statistically speaking) to earnings. And one could recognize that earnings growth of STI components as a whole, wasn't spectacular (both top and bottom line) at least, when compared to their Dow/S&P/Nasdaq counterparts. 

S&P 500 earnings history (https://www.macrotrends.net/1324/s-p-500...gs-history):

Orange = Aggregate EPS
Blue = S&P 500 (30 years history)



I don't index, but if I were to choose between indices, I would choose one with reasonable valuation, and better long term earning growth prospect going forward; I do the same thing with stocks.

(PS: Can't find the equivalent STI chart, perhaps more experienced Buddies can assist with that.)