The person claimed to have made $200k on a house sale in his 20's, some kind of stock option windfall (maybe $500k) in his early 30's and claimed to always have made $100k+ from his labor. The estimate was about $50,000,000 but, in his mind, he was crushing the market despite AUM in low millions (still impressive). He also was from money, attended private schools and also mentioned inheriting money, which makes his estimates of investing abilities even more ludicrous. He was an intelligent person, but ego, some kind of ability refraction or Ostrich Effect prevented him from accurately assessing his own investing abilitiesDave wrote: ↑Sat Jan 22, 2022 3:41 pmAs @The Old Man mentioned, the value investing "bible" wasn't published until 1934, so their weren't really very many value investors other than Graham and Dodd themselves active in the 1930s. Without digging, I can't pull up the results by year, but I know Graham's partnership put up some solid results in the period following the Great Depression. In fact, TGD was an important driver in Graham developing a method that approached investing by focusing on buying at a discount to measurable value, such that the investment would work out even in adverse market outcomes.
Regarding the 1970s, and at the risk of cherry picking (although this is the best list I know of), one can look at Buffett's The Superinvestors of Graham and Doddsville, available online. Those are some pretty impressive records, on both a relative basis and an absolute basis.
Not to take away from your point though - timing certainly plays a huge role in the level of performance achieved, and it's going to be hard for anyone to have strong absolute results in a period of market strife.
I know what you're saying and I think it's fair. The qualification of "over long periods..." is important here. But it's maybe worth expanding on a bit.
If someone crushes the equity market over 30 years, the odds are they are going to end up pretty wealthy. How wealthy depends on a few things: the absolute level of return, the starting capital, and the contributions throughout the investment periods. For successful investors who manage outside capital, this last category (contributions) can hugely drive the outcome, as fees on a large and growing capital base can be massive. So stack up a maybe some starting personal capital, a large and growing fee income, and compounding personal capital, and you're going to end up with that jet and butler.
I'm not so sure that everyone is going to end up at that level, though. If you have 3% outperformance in a 50 year period where the market does 5%, your outperformance is really significant (see math in an earlier post of mine), but you aren't going to be fantastically wealthy unless you started with a ton of capital or had very large income along the way. This can be easily confirmed by running a variety capital/income/return scenarios in Excel.
This is perhaps a trivial point, but I just want to point out that the strategy can be legitimately effective without resulting in massive wealth. So just because someone isn't insanely wealthy (even after the long periods) doesn't mean they didn't add alpha. So the idea mentioned in this thread "if you're not super rich you aren't generating alpha" is a bit simplistic.
While I don't mean to suggest it's common, I bet there are quite a few people who fit into this bucket. Private investors who have done quite well over long periods of time. They aren't broadcasting it to the world, so there is no record (back to the OPs question), making it hard to know.
Haha to your point though, yeah, if someone put up 20% returns for over two decades while earning an above-average salary, yeah you would expect them to be a in a pretty stellar place financially...unless perhaps they hadn't read ERE and are only saving 5% of their income .
When someone brags about their investing abilities once, I just say "Wow, that's impressive". If they do it over and over again, I get annoyed and ask to evaluate their portfolio to estimate the exact outperformance and the bragging stops. Investing skill/luck is so rare, fleeting and sporadic that it is like finding LeBron James or other NBA star shooting hoops at your local YMCA.