As I’ve explored the various investing forums on this site, I’ve noticed that every forum is infested with Bogleheads. I had no opinion on Bogleism before I started looking at these forums, but I have quickly grown to despise Bogleheads. These people are the epitome of the Dunning Kruger complex - they know absolutely nothing about investing but talk down to everyone 24/7. They actually have no idea what they’re talking about, where it comes from, or how to apply it.
First off, passive investing relies on active traders/value investors doing the heavy lifting. The market only works because people are actually digging into the numbers and deciding what a company is worth. When you just buy the whole index, you're coasting on the work of the active managers you claim are useless. If everyone did that, the whole system would break because nobody would be setting prices.
Then there’s the fake sophistication. They lecture you about "uncompensated risk" like it's a law of physics, but they forget that only applies if it’s not possible for you to find inefficiencies in the markets that you are then compensated for with higher returns.
They forget that the portfolio theory they’re parroting assumes that markets and investors are rational - obviously not the case. They don’t know this because they’re not intelligent enough to think about the information they consume or go past whatever is fed to them. MPT is like rational choice theory. You must operate under certain assumptions to learn fundamental concepts, but real life is messy and works very differently.
Even funnier is that they like dropping “factor tilts" without having a clue how the actual Fama-French model works. They just parrot buzzwords to make their strategy (which is to literally do nothing but purchase index funds) sound like advanced quantitative analysis.
You don’t need to be doing financial modelling to decide how to allocate your money between Vanguard index funds. Then again, they’re so bad at making decisions that the new meta for them is just buying VT. Can’t pick a stock or a fund, so they just buy a tiny piece of everything 😂😂
I challenge any of you guys to tell me I’m wrong about anything I said in this post.