How You Can Beat Wall Street’s ‘Smart Money’ With One Simple Trick

If you’ve ever felt like investing in the stock market is a rigged game designed for insiders and hedge funds, you’re not alone. But here’s the thing: You don’t need secret handshakes or private deals to grow your wealth.

You just need a simple plan that works. While “smart money” overcomplicates the obvious, regular investors can come out ahead with the right mindset, the right tools, and one surprisingly simple trick. Here’s how to take back control and start beating Wall Street at its own game.

Who Is the ‘Smart Money’ on Wall Street?

Wall Street’s “smart money” is the collective muscle of institutional investors, hedge funds, and seasoned professionals who move markets not with noise, but with knowledge and billions of dollars in capital.

These players aren’t guessing; they’re running deep analysis, leveraging insider networks, and spotting opportunities long before headlines catch up.

How Can You Beat the Smart Money?

For years, retail investors have been told that private markets are where the real money is made, exclusive funds, inside access and high net worth circles. But sometimes, the best returns aren’t hidden behind velvet ropes.

In 2024, the S&P 500 Index outperformed private equity, venture capital, and private debt across every major time horizon for the first time in nearly 25 years. That means regular investors who used one simple trick might have beaten billion-dollar funds with all their analysts, models, and insider access. You didn’t need a Harvard MBA or a meeting with a fund manager. You just needed to believe in the long-term resilience of the U.S. stock market.

Using ETFs that track the broad U.S. stock market, such as the S&P 500 index, can provide you with broad exposure to America’s largest companies, low fees, and transparency, all without lockups, complex valuations, or performance fees.

Top S&P 500 ETFs

For building real wealth without the noise, the SPDR S&P 500 ETF Trust, the iShares Core S&P 500 ETF, and the Vanguard S&P 500 ETF have consistently delivered strong returns over the long term.

These funds quietly let your money grow while the so-called “smart money” chases complex strategies that don’t always deliver. Over time, the simplicity of owning a piece of the entire market has proven more effective than the high costs and high drama associated with private funds.

The chart below looks at the changing values of the S&P Listed Private Equity Index and IVV, SPY, and VOO. The private equity index tracks major private equity firms, so we can use it as a proxy for private equity performance. While not a perfect mirror of private fund returns, it gives a general picture of how private equity has fared against basic S&P 500 index investing.

The Bottom Line

You don’t need to outsmart Wall Street to beat it; you just need to stop playing its game. The beauty of the S&P 500 Index and its respective ETFs is that they put power back in your hands, letting you build wealth with transparency, control, and confidence. While the smart money chases complexity, you can opt for simplicity, and history shows that simple solutions often win over the long term.