Doesn't this only hold as long as relatively few people are pursuing this strategy?
Basically, no. And to whatever extent it tends towards 'not holding' it is self correcting in as much as that gives more incentive to (large) investors to acquire and use information. It is never going to be worthwhile for a personal investor to attempt to beat the market.
It is never going to be worthwhile for a personal investor to attempt to beat the market.
That statement looks very iffy to me. I see it as a strong claim resting on a bunch of unstated assumptions and with no evidence to support it (don't forget about the difference between "a personal investor" and "an average personal investor").
P/S/A: There are single sentences which can create life-changing amounts of difference.