For two and a half years, I had the humbling experience of almost certainly being one of the dumbest people in the room. Attending the renowned J.L. Kellogg School of Management in the early 90's, I was routinely impressed by many of my follow students who grasped some of the most difficult subjects with incredible ease. I enjoyed being around most of them. The exception were those who endeavored a career in portfolio management. They argued incessantly about market inefficiencies. "How the heck can the market price of that stock be $40 per share," one would argue. "It's a dog."

"It must be hard being smarter than just about everyone else," I once told a group of these wizards. "When you learn you are wrong, I hope it won't be fatal."

Intellectual elites are everywhere on Wall Street (Washington too, but that's another story). To them the market is nothing more than a collection of ignorant boobs who are right only when they're lucky. And yet, the market defeats 80% of these elites every year. And for some, the outcome is literally (and sadly) fatal.

So why is that? How can the collective wisdom exceed that of the smartest people in the group? For answers, watch the following video. And for more on this concept, I recommend an excellent booked called The Wisdom of Crowds by James Surowieki. I'll send a copy to the first five people to leave a comment below.