Timing the Market

The most expensive investing mistake in existence. Peter Lynch said: "Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in corrections themselves." Data proves it: if you missed the 10 best days in the S&P 500 between 2003-2023, your annualized return dropped from 9.8% to 5.6%. Miss the best 20 days: 2.9%. Miss the best 30: 0.8%. The best days almost always occur within two weeks of the worst days — meaning the people who sell during crashes miss the recovery. Dollar-cost averaging into index funds beats market timing 94% of the time over 20-year periods.