I’ve long been an advocate of investing for yourself because, after all, nobody cares more about your investments than you do.

Plus, with some education and a bit of research, you can most likely do better than most of the professional money managers (that’s because the professionals have to worry about their jobs and therefore take a very short-term approach to investing — which invariably hurts their long-term performance. Just think of what would happen to him if a manager underperformed the markets 3 years in a row. That’s why we have performance-hurting behaviour such as Window Dressing and such. If you’d like a ton of other reasons why I believe investing with most money managers will hurt you, and what you can do about it, just read my book, “The Pragmatic Investor“).

Of course in heady, bull market times, most people aren’t too concerned with losing a few percentage points because of bad decisions (they should be, but they’re generally not because if they’re making 20 or 30 percent, they’re not too worried about an extra 4 or 5 percent — the fact is, those extra percentage points can translate into hundreds of thousands of dollars over the long-term, but hey, that’s human nature).

In Bear markets, however, a person’s focus changes. Now every extra percentage point becomes very important. And people who’ve just lost lots of money and watched their portfolios go into freefall start wondering why they are paying huge fees to others so they can lose money. And then they start to think about doing it themselves.

Unfortunately the large majority of these people will try managing their own investments and fail miserably (usually because of the deadly combination of lack of knowledge and emotions).

Others will learn what they need to know and then invest successfully for the rest of their lives. But these will be in a tiny, tiny minority. One of the things that can help in this area is an investment club (or the more prestigious-sounding peer-to-peer investment network).

There’s a good article about investment networks here.

Of course you don’t need an investment network to invest successfully on your own. But it is another option for you to consider.