If you watch Game of Thrones, you know lots of prominent characters are unexpectedly killed off. In the first season Ned Stark who’s a strong, stable leader gets beheaded. If you’d been a Ned Stark fan, you were suddenly without a basket for your eggs.
I realized Game of Thrones is like the stock market because you can’t predict which way it’ll turn, so picking one favorite thing to invest in probably isn’t the smart choice.
Over time, the chances are slim that you’ll pick winners, especially compared to how the stock market as a whole performs. About 90% of people, professionals and regular folk, who pick a stock or several particular stocks will underperform the stock market average.
Putting money into an indexed stock fund avoids big mistakes. You’re spreading your risk across many different players in the market. Of course you avoid the big home runs too, but there’s a smaller than one out of ten chance that you’ll pick that home run stock. Over a long time frame the market in general wins. If you’re not in it for the long run you’re gambling rather than investing.
You’re better off in the long run betting that the ecosystem will keep growing steadily instead of betting on just one member of the ecosystem.
Ned Stark was snatched away but the Game of Thrones carried on, and is even more popular today than when Ned Stark was around.