For me I don't care about #2. If you had the most boring investment in the world that returned exactly 7% every single year I would put 90% of my assets there immediately. But I'd keep trying to beat that 7% in my casino fund.
Average return from S&P500 from 1928-2015 is 11.41% [ source : http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/... ]
Note that this is not inflation adjusted; inflation is about 3.4% historically.
It'd take a little over 21 years to get a nominal 10x return at 11.4% average return.
From 1928-2015, of the 88 years, 24 were down years. Probability of a down year is 27%
Although picking stocks is still not rational if your only concern is your long run wealth, it's not irrational for the same reason as gambling. It's bad because you have the same expected return as low cost index funds, and you exert effort or pay fees for the privilege. That doesn't mean I look down on everyone who actively invests though-- they may have good reason to think they are special and can pick stocks better than average or they may just enjoy it, as the person to whom you responded said he did. And then it would be rational to actively invest at least some of the time.
Index funds, however, do have +EV.
I guess im just too cynical to believe a company can operate indefinitely with indefinite growth!
Some people say lottery tickets are the highest risk portion of the portfolio, but for people who like looking at numbers as you're describing, I think this is a better option.
1. It's really boring. There's no earnings to follow, no products to watch, etc
2. You can't get rich from most indexes. The risk and reward is too low. It's unlikely to invest in a index that gives you a 10x return, though it does happen.
In the end I keep the bulk in a low fee composite index but I like to speculate with a little, even if I invariably lose money on the spec part. It's more fun.