Betting Markets Shouldn’t Be So Easy to Play: Allison Schrager

A great financial economist once tried to convince me that retail investors should not be allowed to buy individual stocks. I strenuously disagreed: Wasn’t this America, the country that encourages risk-taking? Why shut regular investors out of the chance to get rich?

I have now come to realize that he has a point. Most people don’t know what they are doing. Buying individual shares, as this professor argued, is like buying a spark plug for a car; it is only useful as a part of a whole, in this case a diversified portfolio. Most retail stock-pickers will underperform the ...