Mr. Accuride I have personally seen a decline in my portfolio far greater than 50% during the GFC (more than fully recovered the loss though and am doing quite well). If you can't stomach a 50 - 60% decline on the market value of your stock portfolio without blinking you (I mean in general not you specifically) are not fit to be a value investor. It comes with the territory, because value investors do not use stop losses and most of them (including me) don't hedge their positions.
I already covered the argument about time investment. There is a learning curve, you cannot decide to just index and then one day when you have a million dollars to invest decide "right I have enough money to be an active investor so I am going to invest my million dollars actively". You need to cut your teeth on smaller sums of money first. It takes years to get good at investing.
Also as I have pointed out numerous times already I invest in the Australian stock market, so I did not get the same tailwinds that the U.S.A. market got. The Australian share-market (All Ordinaries Index) is still around 15% below its pre-GFC peak. My portfolio has far out-perfomed the Aussie market but I did not get the tailwinds that U.S.A. investors got.
As for value investors trailing the index you are describing fund managers who for a variety of reasons I previously outlined are at a structural disadvantage (despite the additional research fire-power) to private investors. My feeling is that seasoned and experienced private value investors have likely done just fine and probably in aggregate outperformed the index (there are no stats on experienced private value investors so we cannot be sure).
Of course no matter what methodology you use its never guaranteed that you will outperform the index. However the right strategy and the right execution of that strategy will put the odds in your favour.
I already covered the argument about time investment. There is a learning curve, you cannot decide to just index and then one day when you have a million dollars to invest decide "right I have enough money to be an active investor so I am going to invest my million dollars actively". You need to cut your teeth on smaller sums of money first. It takes years to get good at investing.
Also as I have pointed out numerous times already I invest in the Australian stock market, so I did not get the same tailwinds that the U.S.A. market got. The Australian share-market (All Ordinaries Index) is still around 15% below its pre-GFC peak. My portfolio has far out-perfomed the Aussie market but I did not get the tailwinds that U.S.A. investors got.
As for value investors trailing the index you are describing fund managers who for a variety of reasons I previously outlined are at a structural disadvantage (despite the additional research fire-power) to private investors. My feeling is that seasoned and experienced private value investors have likely done just fine and probably in aggregate outperformed the index (there are no stats on experienced private value investors so we cannot be sure).
Of course no matter what methodology you use its never guaranteed that you will outperform the index. However the right strategy and the right execution of that strategy will put the odds in your favour.