Who's Smarter, the Pros or the Little Guy?

Last September, I published the 2010 investment advice given by several market professionals and posed the question,
"What would earn you the most money,

• Buying the entire S and P 500 Index or 
• Buying just the sectors of that Index that the market pros suggest?"

Buying the S and P 500 Index would initially cost you a commission, but since you would to pay for no advice, you could pay under $10 commission at a deep discount broker like ScotTrade or ETrade. 

Taking the advice of the market pros would cost you a much higher fee, because

1. You'd need, not only to know what to buy, but also when to sell. 
2. You pay a commission when buying and selling, and must pay capital gain taxes on any gain on your gain on sale, unless you buy in a tax-deferred retirement account.
3. Then, you pay an additional commission when replacing the sold securities with another investment.

So, here's our little 2010 experiment.  We're going to track how much you'd make by just buying the index (consisting of Energy, Materials, Industrials, Consumer Discretionary, Consumer Staples, Health Care, Financials, Information Technology, Telecom Services and Utilities) versus buying just the sectors in that index recommended by the pros.  Here's where we'll start:

Who,
What Sector, Price


Kitty,
S and P 500, 1115.10
                                            
Black Rock,
Energy, 429.95
Health Care, 362.22
                                                          
Deutche Bank Private Wealth Mgmt   
Technology, 370.71
Health Care, 362.22
Industrials, 242.99

Morgan Stanley                          
Health Care, 362.22
Technology, 370.71
Energy, 429.95

Prudential 
Financials, 193.78                                
Technology, 370.71
Material, 199.81
Industrials, 242.99

US Trust                                        
Technology, 370.71
 Materials,199.81
,Energy, 429.95
Industrials, 242.99

Barclays Capital                      
Industrials, 242.99
Technology. 370.71

Citigroup                                     
Materials, 199.81
Financials, 193.78
Technology, 370.71
Energy, 429.95

Goldman Sachs                         
Energy, 429.95
Materials, 199.81
Financials, 193.78
Technology, 370.71

JPMorgan/Chase                     
Energy, 429.95
Industrials, 242.99
Financials, 193.78
Technology, 370.71
Materials, 199.81


RBC Capital Mkts                     
Technology, 370.71
Consumer Discretionary, 235.07
Financials, 193.78
Industrials, 242.99

I'll give you an update at the end of every calendar quarter.  What do you think?  Will trading make you more money than just buying the Index?

It will be an interesting experiment, and one that just may result in you taking charge of your investments yourself.