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Comment by marcosdumay | Hacker News Reader

Between fixed cost fees, things that are sealed behind an accreditation process, investments that need real person to person negotiation, opportunities that aren't widely published, and even data that isn't shared with anybody that shows up, I'm really surprised that anybody can be even be mildly surprised by that phrase.

There is absolutely no investment transaction where it's not obvious that larger players have it better. Even when entering in a shared fund, more money means lower fees.

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OTOH, as soon as you're a very big investor, you can't really invest a ton of money in, say, a small, discounted stock. Let's say you have ten billions to invest and you find that cute little company at an incredible discount, with a market value of 100 million bucks. Just investing 0.5% of your capital in that stock would mean buying half the company, which would make its price raise dramatically (if it were at all possible). But if you only had 100 millions to invest...

I'm pretty sure I've seen Buffett say more than once something like "if only I didn't have all those billions to invest, I would be able to make more money".

> There is absolutely no investment transaction where it's not obvious that larger players have it better. Even when entering in a shared fund, more money means lower fees.

Fees are so low on index funds that I'm not sure this is really true any more. VTI, the largest broad US stock market ETF, has fees of 3 bp (0.03%). Fidelity even offers some zero fee funds like FZROX (presumably actual expenses are subsidized by other products, though).

Yes, ironically one of the forms of investment that maybe isn't biased (or isn't as much biased) is the same one you should favor because of the bias.

There are probably a few others exceptions. For sure they are hard to find, but it's very likely that they exist.

One advantage that small investors might have is that you can go after investments that are too small for larger investors to bother with. You need some way to find out about them, though, and some way to avoid averse selection where you only see deals that more sophisticated investors passed over.

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