Take the birth of the auto industry. At one stage, there were more than 2,000 separate auto manufacturers in the US. Even if you had bought shares in all of them, you would have lost money. It was virtually impossible to know which would fail and which would succeed. However, it was very easy to see who would definitely lose out – horses. The best investment strategy would therefore have been to go short of horses. There were 20 million horses in the US in 1900. Today, there are just 4 million.