With the recent fears of war and daily escalations, what will be the impact on mutual funds investments ?
“Buffett is just a lucky coin flipper.”
That’s what Nobel laureate Eugene Fama, father of the Efficient Market Hypothesis (EMH), said when a student asked how Warren Buffett managed to beat the market for decades.
Fama believed markets are so efficient that consistently outperforming them isn’t skill—it’s luck. So when someone does it repeatedly? He compared it to a coin toss—Buffett just happened to land heads more times than most.
But here’s the real question:
Can someone be “lucky” for over 50 years?
Or does that consistent performance point to something more—discipline, rationality, and deep value investing instincts?
And here’s the kicker:
Most professional fund managers actually support Fama’s theory — unintentionally.
Over long careers, most of them fail to beat the market, and their returns often regress to the mean, exactly as EMH would predict.
This Fama vs. Buffett view isn’t just academic—it strikes at the heart of how we define skill in markets.
Do we believe markets are truly unbeatable?
Or do we believe some people have frameworks, principles, and patience that give them an edge?
Either way, it’s a powerful reminder:
You can believe in efficient markets and still learn a lot from those who occasionally break the rules… with results.
What’s your take: Was Buffett lucky? Or did he just understand value when others didn’t?
#Investing #WarrenBuffett #EugeneFama #EfficientMarkets #ValueInvesting #Finance #CoinFlipTheory #BehavioralFinance