How Dave’s Dad Beats 99% of Wall Street

Dave explains how investing is like no other field in that his dad’s hands-off index investing approach beats most professional money managers. Amber Kanwar talks about one of her stock-picking experiences and why she thinks younger investors often need to learn investing lessons themselves.

💈💈💈

You know it’s bizarre, if you think about Michael Jordan, the greatest basketball player ever, and then you say, okay, Dave Chilton or Bob Chilton’s gonna go out and play 1 on 1 against Michael Jordan. We all fall on the floor laughing. But then you look at my father, he has beaten 99% of the top managers in the world of performance. How bizarre is that? There’s no other field in the world that can say something like that. This guy watches Detroit Tiger baseball and plays Bridge and just buys index funds and he beats 99% of the famous people you have on the show. It’s nutty.

That’s an argument for the do nothing camp, right?

For sure. It is.

You can be informed and kind of do nothing. I mean, my Google example is so perfect. It’s like just one of the most painful lessons. I’ve owned Google for years. I was up on it huge. And then, you know, ChatGPT came out, they had a bunch of these flops and I thought, oh, this is it.

Their market share slipped from 92% to 91%. Like, this is it, I’m gonna lock in my gain. And I just, I left, I dunno, maybe a double on the table. And again, even though I know these lessons, I do think it’s important for me to learn it and share it publicly so maybe nobody else will make those mistakes. But to you know, just to circle back to those young people you said you don’t want them to even make this mistake in the first place.

I suffer from toxic positivity, so I always gotta see like the bright side to everything. I think it’s really beautiful that there’s a whole new generation of investors that have been minted. I think it’s a really good thing, and I think they’ve all made their mistakes and they got crushed on, whatever they got crushed on

Those kind of experiences, you know, hardship forms success down the road. It’s important for people to learn those lessons.

And now when, oh, you know, maybe I will just own Royal Bank.

Oh, this, you know, this has a nice dividend, you know, it’s boring, it’s whatever. But, but they need to learn those lessons in order to understand. And some people need to learn by like facing those mistakes.

Hopefully people learn just by listening to me and you.

Right.

You can just invest and don’t make those mistakes. Don’t let people scare you out of the market, scare you out of profits. Um, but some people do need to learn the hard way, And I think it’s better that they learn when they’re young.

Yeah. Again, I, I go back and forth that I do think the opportunity cost is huge and I would rather they just learn about investing in general and the odds favor this approach being better than this one, et cetera.