
Market Timing Traps and Temptations
The markets had a fairly dramatic turnaround this July, even as national and global headlines remained relatively bleak.
Stock market declines over a few days or months may lead investors to anticipate a down year. But the US stock market had positive returns in 16 of the past 20 calendar years, despite some notable dips in many of those years.
Volatility is a normal part of investing. Tumbles may be scary, but they shouldn’t be surprising. A long-term focus can help investors keep perspective.
Past performance is no guarantee of future results. Indices are not available for direct investment. Their performance does not reflect the expenses associated with the management of an actual portfolio.
In US dollars.
Data is calculated off rounded daily returns. US Market is represented by the Russell 3000 Index. Largest Intra-Year Decline refers to the largest market decrease from peak to trough during the year. Frank Russell Company is the source and owner of the trademarks, service marks, and copyrights related to the Russell Indexes.
Investing risks include loss of principal and fluctuating value. There is no guarantee an investment strategy will be successful.
This post was prepared and first distributed by Dimensional Fund Advisors.
Shore Point Advisors is an investment adviser located in Brielle, New Jersey. Shore Point Advisors is registered with the Securities and Exchange Commission (SEC). Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. Shore Point Advisors only transacts business in states in which it is properly registered or is excluded or exempted from registration. Insurance products and services are offered through JCL Financial, LLC (“JCL”). Shore Point Advisors and JCL are affiliated entities.
The markets had a fairly dramatic turnaround this July, even as national and global headlines remained relatively bleak.
Being out of the market for even a short time can have profound effects. Missing strong returns can drastically impact overall performance.
Financial innovation provides investors with many new investment options, but how do you know if an asset is a good fit for your portfolio?
There is no proven way of market timing, whether it be targeting the best days or moving to the sidelines to avoid the worst.