If you find yourself picking stocks and beating the Vanguard S&P500 fund, congratulations. That is something which only 99% of monkeys can accomplish.
https://www.cass.city.ac.uk/news-and-events/news/2013/april/monkeys-beat-market-cap-indices A better benchmark might be the percentage of 100-stock monkey portfolios you beat, rather than a total market fund. Also along those lines, the above is why I am not as gung-ho about total market or S&P500 funds, I find buy-and-hold monkeys to be more aspirational especially when adding lots of new money regularly.
A good analogy for trading is roulette. Buyer gets black, seller gets red, and green goes to Wall Street. While buy-and-hold monkeys and total market indexing have positive expected returns over the long term, trading has a negative expected return.
Imagine a roulette tournament with 1,073,741,824 entrants (2^30), and each entrant puts $1 into the first round to kick things off. All entrants pair up and spin a wheel. Losers drop out of the tournament with nothing from the round, winners keep half their winnings and put the other half plus principal into the next round. If it lands on green, Wall Street wins the round and both contestants drop out. Nearly half the entrants make money from the first round, which gives a general feeling that winning is doable. By the fourth round, 10% of the entrants have made lots of money, which are more than 100,000,000 people. They talk up how easy it is to make a fortune at roulette, and are annoying to hang out with to everyone else. By the 7th round more than 1% of the roulette entrants continue to win, which is 1,000,000 people, and they hit the internet, converging on unsuspecting comments sections and forums to say that they did it, why can’t everyone else? Eventually a handful of people turn their $1 into $1,000s or even $10,000s. They buy politicians and write books called “How to Beat Roulette.” A new tournament starts every business day, with mass participation.
All those roulette people lost sight of the bigger issue, which is that none of them had any skill, it was entirely due to luck, and by the 27th round or so, the expected outcome was that Wall Street had taken more than half the starting money. The expected outcome for all entrants is a loss. Beating the market is not evidence you have skill. With a starting pool of a billion, many many people can be expected to beat the market with undiversified investments through random chance. If your stock picking has high turnover, this analogy might be a very good one. The harder question is, are your returns high enough to know for certain that you are more than just a lucky roulette player?
A final point is I am beating a buy-and-hold portfolio of any combination of Vanguard funds whose names contain “Total” by about 1% annualized (I aspire to be a monkey, but all my investments contain “Index” in their names). I learned enough about investing to know that chance was involved, but over long periods this is the expected outcome. The part that I didn’t include is I spent probably 2,000 hours reading books, forums, and blogs to learn that. If I had worked that many hours at a Home Depot side gig and put all my money in the Vanguard 2050 fund I would have been far, far ahead. If I put in that time at the $35/hr I get at work, I would have been better off (so far) never learning about investing and sticking it in a Wells Fargo 0% saving account. If your time is important to you for doing something else you are almost certainly coming out far behind by not indexing.