On the quest to pursue a better investment experience Scott goes beyond the idea of embracing market pricing and stresses to listeners not to try and outsmart the market.  Scott provides evidence of how and why it is so difficult to try to beat the market with conventional investing.

The market's pricing power works against mutual fund managers who try to outsmart other participants through stock picking or market timing.

Many fund managers believe they can identify “mispriced” securities and convert that knowledge into higher returns. But fair market pricing works against such efforts, as indicated by the large proportion of mutual funds that have underperformed their benchmarks.

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In this chart, the gray box represents the number of US-domiciled equity funds in operation during the past 15 years. These funds compose the beginning universe of that period. The striped area shows the proportion of funds that survived the 15-year period through the end of 2014. The survival rate was 42%. The blue-shaded area shows that only 19% of the equity funds survived and outperformed their respective benchmarks during the period.

Over both short and long time horizons, the deck is stacked against mutual funds that attempt to outguess the market.

As evidence, only 19% of US equity mutual funds have survived and outperformed their benchmarks over the past 15 years.

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