[Aggie93]

I agree with Cannonball in that buy and hold for years strategy has changed. It can still be a good strategy, but you really need to know the company and not be influenced by the amount of noise. Some of the best funds out there are still able to be successful with turnover in the low teens.

Hedge funds now account for half, if not more of the volume. The fact that they move stocks causes everyone else to follow suit. Most of these guys know the companies very well. The wannabes have mostly been shut down. The big funds survived 2008 and now all the money is flowing to the big funds. Most hedge funds play for an event and typically unwind the position after it happens or fails to happen. They also can short. I think very few do even a decent job. It is a totally different strategy. This strategy also causes a lot of volatility in the stocks that are “crowded shorts.”

The amount of information available in the market place is staggering. Also the speed at which news impacts stocks is almost instantaneous. Most of it is noise and to be successful you have to have a very good filter and also know what is already “priced in.”

Individual investors that are trading are at a significant disadvantage. I’m able to have conversations with trades/analysts/portfolio managers and know how other investors are positioned and what their expectations are. Additionally, I get messages and phone calls all day from trading desks letting me know their large orders. One example, I just got hit that someone has 500k GLW to sell, a quick call yields that they were a large seller last week. Not earth shattering, but nice to know if you are involved in the name.