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0 pointshash8722y ago0 comments

If you don't have data on private investments, how can you say anything about how they compare with an index fund? As a passive investor in a local business, my losses are pretty limited by their corporate structure.

I've been self-employed for about 6 years now, and my return on my original invested capital is hundreds of % a year. My potential losses are highly limited by being incorporated- I can always just close the business and walk away. I think it's ridiculous to compare my little company with an index fund, but I also think it's pretty silly to make sweeping statements comparing public stock markets with private investments. It's OK to say that 2 completely different things are apples & oranges

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t_mann2y ago

I'm saying what data you should be looking at when you're comparing investment opportunities, not doing the work of assessing specific investments for you.

Being self-employed isn't a financial investment, it's a form of labor and most certainly not passive, hence why the comparison fails.

hash872OP2y ago

What is the body of evidence that leads you to think you can't exceed a (totally unrelated) benchmark when investing in privately held companies? Can you cite some studies? The reason we know EMH 'works' for public markets is decades of research. What research lead you to a similar conclusion for private markets, can you link some of it here?

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