Beat the Stock Market

Beat The Stock Market? No way says 2013 Nobel Prize Winner Eugene Fama: According to the theory, stock market prices are extremely difficult to predict in the short run, because new information is very quickly incorporated into prices.

Numerous studies have found that only a small percentage of individual investors can beat stock market returns. One reason is that most try to time the stock market. They add to their holdings during boom times and pull out when the market drops. Actually they end up following a  “Buy High & Sell Low” strategy. They follow stock market falls. They miss stock market rebounds. They incur high transaction fees and taxes. Most never beat the stock market.

Because they think they have the best stocks in the stock market, they  lack diversification which is fundamental if you want to beat the stock market on a regular basis.

That’s why investing in a stock market ETF such as QQQ, IYY, DIA, maybe one of the best strategies, coupled with tax sheltered accounts such as IRA, SEP, or Rollover 401Ks.

There will always be funds managers who will beat the average, by chance. The ones that lose money tend to close their operation and disappear from your radar.


Our model was created in 2004. Since then the performance has been impressive: $1 invested in 2004 is now worth around $4.

Cumulative return Beat The Dow versus Dow Jones Industrial performanceYou are invited to check by yourself. First have a look at the Current Year Performance. Then visit our Past Performance page to see how the model performed last year and before versus the Dow Jones Industrial Average and the stock market.

While past performance is no guarantee for future results, we feel confident the model will continue outperforming the stock market as a whole as well as most investment strategies based on the Dow Jones Industrial Average index or the Dow Jones Industrial index components in the future. And also beat most mutual funds: More than 80% of mutual funds underperform the stock market’s average returns. For a detailed list of risks involved, please read the Risks page.

Subscribe now to Beat The Dow: enter your e-mail address on the right side of this page. We will not communicate your e-mail address to anyone. You will receive an e-mail each time the model changes position. If you want to follow the model, you will have to place your order on the stock market with your broker on the same day at market close. Our Subscribers Section pages will guide your first steps.

Start now and beat the Dow Jones index and the stock market!
Best of all, it’s free.

A few facts about competition who tries to beat the stock market. Hopefully this will convince you that our model beats most investments available:

  • 40% of mutual funds in operation in 2004 had shut down by 2014 (source: Morningstar).  Funds that consistently beat the market rarely shut down.
  • Total return for investors from 2009-2013 averaged 6.4% verses a return of 7.7% had they remained fully invested which shows that trying to time the market rarely works.  -Morningstar study Nov 2013)
  • The average US stock fund returned just 2.1% verses the S&P 500′s return of 9.1% over the 12 months ending in July 2012.  -Kiplinger’s Personal Finance (Oct 2012)
  • In the past 5 years, more than 2 of every 3 mutual funds followed by Morningstar under-performed their underlying stock or bond index.  -Smart Money magazine (Feb 2012)
  • 64% of Large cap mutual funds under performed the S&P 500 in 2010.
  • More than 25% of actively managed stock funds under performed their corresponding indexes by greater than 5% in 2010. Only 7% outperformed by the same margin on the upside.
  • The S&P 500 returned an average of 8.4% between 1988-2008. Only 21 of 57 mutual fund families outperformed the index during the same period.
  • The S&P 500 beat 75% of actively managed mutual funds from 2002-2007.
  • The S&P 500 Index has returned 13.5% over the past half century vs. 11.8% for the average mutual fund on an annualized basis.
  • Only 11% of large company funds finished in the top half of their peer group in each of the past 5 years.
  • About 3/4 of active professional fund managers lag the S&P500 in an average year.
  • Only 12% of all mutual funds have outperformed the S&P 500 stock market Index since 1970.
  • The average stock mutual fund replaces nearly its entire portfolio over the course of a year which generates trading costs that don’t get included in a fund’s expense ratio making their performance results actually worse than reported.
  • Over 80% of investment letters fail to beat the market over the long term according the the Hulbert Financial Digest.
  • Only 4% of diversified US stock mutual funds have beaten the performance of the S&P 500 stock Index over the past 10 years.
  • From 2001-2005, the average large company fund beat the Russell 1000 Index in only 3 of the 20 quarters.
  • During the same period, The S&P 500 beat 62% of all actively managed large cap funds.
  • During the past 15 years, The S&P 500 stock index beat 60% of all actively managed large cap funds. This percentage is actually much higher if you count all of the funds that folded which don’t get included in the statistics.

(Data from and Morningstar about the US Stock Market)