March 24, 2010
Approach To Investing
Your approach to investing has to change if you think you can time the market. I just read an article at yahoo finance which backs up what I've known for years, that timing the market is virtually impossible.
Research for the twenty year period 1983-2003 is below. Pay attention and learn something that you may not already know and certainly your stockbroker or financial advisor is not telling you.
1983-2003 period for S&P 500
Buy and Hold = 10%
Minus the 30 worst days = 19%
Minus the 20 best days = 5%
Moral of the story is that if you are willing to risk missing the best days trying to miss the worst days, go ahead but you will have probably wasted a lot of your time, and money and got nowhere. You need to change your approach to investing.
I have said it before and will say it again, buy a no-load mutual fund or ETF that tracks the S&P 500 and you are doing really all you can do.
Posted by Scott Barclay