touche.  

wc himself seems to spend a lot of effort looking at the fundamentals and investing according to his best assessment of the "available information", which means he doesn't really believe all information has been discounted, or the two-fund theorem.

but I would say this just slightly different than this.  I try to find areas of the market where I have insights, or knowledge, that I think the market has not yet taken into account.  So in my little world that most commonly happens in healthcare, where I have spent years working and investing and think, hope, I have an ability for seeing through the fog,,,,,and it's doubly good if the insight is in  small cap stock, because these are often too small to have garnered attention of the big time analysts.  So there is a company I am watching that failed their clinical trial, refinanced, and modified their drug and corrected flaws in their trial design--and I think it was too small for the market to pay attention.  so far, so good, it's doubled with some recent results.  but I'm getting a little worried because now a few more people are watching it--they could outsmart me, but I think I'll get another 50%----and this is a case where up until now I have felt I know the trading patterns for the stock a little better than others, so I have done some shorter term trading (not day trading, but month to month) and earned pocket change+.  

so I look for segments where I think the market has not yet discounted available information, or maybe said another way where the markets for some reason are not closely followed and the random walk theory won't apply, and try to make a little extra money there.  (that and the private investments are areas where insight and hard work can give me an edge).

but on calling the big companies, or the overall market trends, I find that I probably lose as much as I win--ie, a random walk.  so why not just take the index funds in those areas?