I've Covered Investing for 22 Years. Here's What I Tell Every Beginner to Invest In.

I've been an investment professional for a long time now. I've seen it all, heard it all, and done it all... most of it at least twice. And the longer I'm in this business, the more convinced I become of something. That is, the harder you try to beat the market with more activity, the more likely it is you'll underperform. Simpler is better.

That's good news though. It means even newcomers with little to no knowledge of how the stock market works can do well enough for themselves. In fact, they may fare even better than average.

But what does this mean in practical terms? A lot, but it means one thing in particular: the very first investment you should make and then stick with forever. It's not a stock at all. I suggest the Vanguard S&P 500 ETF (NYSEMKT: VOO) or the SPDR S&P 500 ETF Trust (NYSEMKT: SPY), both of which are just meant to mirror the performance of the S&P 500 Index (SNPINDEX: ^GSPC). Here's why.

Beating the market is easier said than done

I get it. The stock market's apparent complexity and everyone else's apparent investment experience may have you hesitant to get started at all.

I'm going to let you in on a little secret about the market though. That is, while plenty of people may understand the mechanics of placing a trade and can discuss stock-picking philosophies, most of them -- including the professionals -- aren't regularly beating the market.

Image source: Getty Images.

It's true! Over most three-year, five-year, and 10-year stretches, most mutual funds (hand-picked baskets of individual stocks) available to U.S. investors didn't perform as well as the broad market barometer you know as the S&P 500. And the few that did outperform in one time frame rarely outperformed in another. In this same vein, despite being managed by those who are supposed to be Wall Street's brightest stock pickers and are paid for their performance, most hedge funds also regularly trail the performance of the S&P 500 index.

What gives?

There are several explanations for the counterintuitive phenomenon. As a former stockbroker and a student of investor behavior for over two decades now, I can sum the problem up by saying this: Too many investors are far too active, buying and selling stocks only based on hot headlines without considering the fact that those headlines are mostly just meant to attract readers rather than serve as sound investment advice. Those headlines are often backward-looking rather than forward-minded. Given this, as even novice investors might suspect, regularly responding to every headline chips away at your investments' net performance.

Don't play a low-odds game until you're sure you understand all the rules

Fortunately, there's a simple solution for less-experienced investors: Rather than playing the (proverbial) game in a way that doesn't even work all that well for seasoned investment professionals, choose not to play the game at all. Specifically, rather than trying to pick individual stocks that may or may not beat the market, beat your low odds of success by simply buying and holding a slice of the entire stock market. That's what the aforementioned Vanguard S&P 500 ETF and SPDR S&P 500 ETF Trust do, plugging you into the popular index that since 1928 has returned an average annual gain of about 10% per year.

No, it's not a fun or exciting holding... not the sort of pick you brag about owning at cocktail parties.

It is an investment that makes good practical sense though, especially if you're not yet confident or comfortable enough to choose individual stocks but still want to participate in the gains that only the stock market can offer.

To this end, if and when you decide you're ready to own stakes in individual companies, you don't necessarily need to sell your position in the S&P 500 index fund to do so. It's still a great foundational holding you can keep alongside company-specific stocks in your portfolio. In the meantime, it's just a smart and simple buy-and-hold choice that doesn't require constant monitoring.

James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy.