This is an interview with two academic researchers into active fund managers who can indeed beat the market consistently sometimes. One factor why they exist is that they have access to better information than the average individual investor. However, (1) excess returns tend to mostly get absorbed by higher fees and (2) it's very difficult to scale it up, funds who beat the market tend to lose this edge when more funds go into them. Thus, market-beating funds, if they want to maintain their edge, have to severely limit who can invest in the fund and how much they can put into it.
The episode also goes into the effect of security selection (which stocks are picked) vs market timing, which is relevant to TFA.
Is this like "60% of the time it works every time"? The fact that there are a few individuals that have beaten the market on occasion is a strong indicator that the chances of any retail trader doing this are slim to none.
I suspect poker has more skill involved than stock trading.
If there are really just a few, it could be explained by chance. Warren Buffet is often cited in that group and yet, a blindfolded monkey would have done better than him in the past 20 years[0].
Warren Buffet also said 20 years ago that he was having trouble find any stocks that he wanted to buy, so he predicted his poor performance. He did very well for the first 30 years of his investment life.
I could be wrong but I don't believe Renaissance Technologies makes their money picking individual stocks. My understanding is that they mostly make money with (statistical) arbitrage, market making, etc.
