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Investing often feels like a competition to see who can sound the smartest. Every day, investors are bombarded with new products, clever strategies, and predictions that promise to beat the market. The financial world loves complexity—it sounds sophisticated, exclusive, and, to some, comforting.
But for most investors, complexity is not a path to higher returns. It’s a detour that leads to higher costs, more stress, and worse results. The truth—borne out by decades of data—is that simplicity, done consistently, usually wins.
The Lure of Complexity
Why are investors drawn to complicated strategies? Part of it is psychological. Complexity feels like control. We assume that a carefully engineered formula or a niche fund must be smarter than something simple. It’s the same reason people buy gadgets with more buttons than they’ll ever use—if it’s complicated, it must be powerful.
Wall Street also benefits from this mindset. The industry earns higher fees by selling sophistication. Structured products, hedge-fund-like ETFs, and intricate “smart beta” portfolios often charge more for promises that rarely materialize.
A 2023 Morningstar analysis showed that among nearly 3,000 active U.S. funds, only about 47% outperformed their average passive peers during that year.¹ The vast majority of investors paying for complexity wound up lagging behind those who simply stuck to disciplined, long-term investing.
The Quiet Strength of Simplicity
Simplicity, in investing, doesn’t mean being naïve or uninformed. It means focusing on what actually works—and ignoring the noise. A clear, consistent investment approach—grounded in diversification, patience, and low costs—quietly outperforms most complex strategies precisely because it does less.
Simple investing succeeds for three reasons:
The Behavior Gap
The late Vanguard founder John Bogle used to say, “Don’t look for the needle. Buy the haystack.” That advice is timeless—and yet, many investors can’t resist searching for the needle. Behavioral economists call this overconfidence bias: the belief that with enough information, we can outthink randomness.
But every trade has two sides. For every investor who sells a stock believing it’s overvalued, another buys it believing it’s cheap. The difference isn’t who’s smarter—it’s often who’s more patient.
DALBAR’s long-running Quantitative Analysis of Investor Behavior has consistently shown that the decisions made by typical investors—buying, selling, and switching between funds—cause their personal returns to lag behind the returns of the funds themselves.² In other words, behavior often hurts more than strategy helps.
When Simplicity Feels Boring
Here’s the catch: simplicity doesn’t feel exciting. It doesn’t give you something new to talk about at dinner. It doesn’t spike your dopamine the way chasing a hot stock might.
But simplicity’s boredom is actually its superpower. The less attention your portfolio requires, the more likely it is to keep working while you get on with your life. A disciplined, rules-based approach that quietly compounds over time is the closest thing investing offers to peace of mind.
How MarketRiders Fits In
At MarketRiders, we built our platform around this philosophy. We don’t try to outguess the market—we harness it. Our system uses decades of research to build and maintain diversified portfolios automatically and at low cost.
It’s investing the way it should be: transparent, disciplined, and designed to help real people reach financial freedom without unnecessary complexity.
The Bottom Line
The markets will always tempt you with complexity—new funds, clever models, and endless chatter about “what’s next.” But remember this: the most reliable path to financial success is often the least exciting one.
Simplicity doesn’t just make investing easier. It makes it work.
As the late Nobel laureate William Sharpe once said, “The surest way to get what you deserve from the markets is to own them.” That’s simplicity in a sentence—and it’s still the smartest advice an investor can follow.
Sources
Information presented is for educational purposes only for a broad audience. The information does not intend to make an offer or solicitation ofor the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and are not guaranteed. MarketRiders (dba Sogotrade Asset Management) has reasonable belief that this marketing does not include any false or material misleading statements or omissions of facts regarding services, investment or client experience. MarketRiders (dba Sogotrade Asset Management) has reasonable belief that the content as a whole will not cause an untrue or misleading implication regarding the adviser’s services, investments or client experiences. Please refer to our Firm Brochure (ADV2) for material risks disclosures.
Past performance of specific investment advice should not be relied upon without knowledge of certain circumstances of market events, nature and timing of the investments and relevant constraints of the investment. MarketRiders (dba Sogotrade Asset Management) has presented information in a fair and balanced manner.
The opinions expressed herein are those of the firm and are subject to change without notice. The opinions referenced are as of the date of publication and are subject to change due to changes in the market or economic conditions and may not necessarily come to pass. Any opinions, projections, or forward-looking statements expressed herein are solely those of MarketRiders, may differ from the views or opinions expressed by other areas of the firm, and are only for general informational purposes as of the date indicated.
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