Even for the pros, outperforming the market or producing "alpha" is a difficult task – but what about for the average investor?
For those Fools that are looking for some extra cash on the side of their existing job, maybe it's worth taking a look at active investing as your "side hustle" in 2019 and beyond.
Beating the market isn't as easy as it seems
While the average punter might have done well by pouring some money into Afterpay Touch Group Ltd (ASX: APT) at $6 per share or jumping on the Appen Ltd (ASX: APX) train in its early stages, the reality is that beating the market consistently is an incredibly hard feat.
But that's not to say that it can't be done.
There are plenty of investors out there who can beat the market and generate some serious side cash from their hard-earned income or their retirement funds.
While index funds can generally track the market and generate a solid return in line with the economic and business cycles, the fact that you're reading on means that you're probably looking for that something extra.
It can be said that your "side hustle" in active investing could involve either growth stocks or dividend stocks, with either having the potential to outperform and deliver you realised or unrealised gains over your investment horizon.
It's important to do your homework
Active investing isn't for the faint-hearted: the reality is that for every winner you get there may be several losers and it can be difficult to stomach the losses and ride the waves to long-term success.
We've all sold out of a super growth stock too early, or held on to a personal favourite when we knew we should have sold.
The real secret to active investing is to do your research thoroughly and look at the industry (and the company's) growth prospects over your desired horizon.
Once you've picked a winner, it's often best not to bet against psychology and just hold that stock until it's reached your target level – irrespective of short-term gains and losses.
In the end, active investing is a tough game and the amount of data at the disposal of institutional investors can make it difficult to outperform the market.
But if you're a well-informed investor who is only putting in what you're willing to lose, there's no reason you couldn't be one of the many Fools to outperform the market and make a decent side hustle out of your investing activities in 2019.
