The impact of missing just a few of the market’s best days can be profound. How to understand market timing is explained below. Take a look at the following example of a hypothetical investment in the stocks that make up the S&P 500 Index.
A hypothetical $1,000 turns into $138,908 from 1970 through the end of August 2019.
There’s no proven way to time the market—targeting the best days or moving to the sidelines to avoid the worst. History argues for staying put through good times and bad.
Investing for the long term helps to ensure that you’re in the position to capture what the market has to offer.
The missed best day(s) examples assume the following:
Annualized returns for the missed best day(s) were calculated by substituting actual returns for the missed best day(s) with zero.
Past performance is no guarantee of future results.
Douglas Finley, MS, CFP, AEP, CDFA founded Finley Wealth Advisors in February of 2006, as a Fiduciary Fee-Only Registered Investment Advisor, with the goal of creating a firm that eliminated the conflicts of interest inherent in the financial planner – advisor/client relationship. The firm specializes in wealth management for the middle-class millionaire.
Understanding How Markets Work for You: Principle 4 in Evidence-Based Investing12 May, 2022
Ideal Investment Portfolio Management: Principle 10 in Evidence-Based Investing03 May, 2022
Why Stick with a Globally Diversified Portfolio? Principle 7 in Evidence-Based Investing28 Apr, 2022
Diversify Your Investment Universe: Principle 6 in Evidence-Based Investing19 Apr, 2022
Resist Chasing Past Performance: Principle 3 in Evidence-Based Investing08 Apr, 2021
What Is Fiduciary Investment Advice, and Why Does It Matter (Now More Than Ever)?17 Sep, 2020
How Has Market Behavior Evolved For Emerging Markets Investing?03 Sep, 2020
When It’s Value Stocks vs. Growth Stocks, History Is on Value’s Side
Please log in again. The login page will open in a new tab. After logging in you can close it and return to this page.