Rule 12 of 19 · Chapter III — Let Time Do the Work
Favor low-cost, broad index funds
Why this rule exists
Picking individual winners is harder than it looks, and most professionals paid to do it fail to beat the simple average over time. Broad, low-cost index funds buy a little of everything and quietly capture the market's overall return, without betting your future on any single company or hunch. They are diversified by design, cheap to own, and require almost nothing of you. This is not settling for average. Over the long run, average done cheaply and steadily lands ahead of most of the clever strategies that charge you handsomely to underperform.
In practice
As a general principle, prefer broadly diversified, low-fee funds over stock-picking, and hold them for the long haul. Favor simplicity, because a small number of broad funds you understand beats a complicated pile you do not. Reinvest what they pay out. Then, mostly, leave them alone, since the activity that feels productive is usually what quietly costs you. Set a rough mix of stocks and bonds suited to how long until you need the money, and rebalance occasionally rather than tinkering. This is general education, not a recommendation to buy any particular fund.
When it doesn't apply
If picking a few individual holdings scratches an itch, keep it to a small, clearly separate slice you can afford to lose, and do not confuse it with your real plan. Personal circumstances vary, and specific choices deserve your own research or a fee-only advisor. This is a principle, not personalized advice.