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OP sounds like he has most of his facts right. The consensus (at least, among those not offering stock or investing services) is that you can't do better than the market, so an inexpensive index fund is almost the best way to go. Your choices in a retirement plan may be limited. However, such gurus as Bogle recommend 100% invested in stock funds for most folks.

Picking stocks that beat the market is, long term, a fool's errand. The big enemies are the commissions the "Wise" collect off your trading. The more you subscribe to newsletters (the Fool's included, alas), the more you trade, the more the Wise make off you, and the lower your returns.

It's human nature ("behavioral investing") to try to beat the market. Good advice is to allot part of your capital for your own trading: perhaps 10 or 20%. Buy and sell stocks you pick, or someone else does. Somebody recommended that. Probably good advice. If you trade infrequently, and diversify, you'll probably perform close to a similar index.
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