Time, Not Timing
Here’s a little story so full of wisdom it could almost be called a parable:
The Investment Company of America’s 1996 Investors Guide analyzed investment returns for the previous 20 years. Over that time, the difference in average annual return between “worst-day” investments – those made at each market top – and “best-day” investments – made at each market bottom – was only 1.5%.
The moral of the story: Time in the market is what counts, not timing the market.
Using dollar-cost averaging to invest a regular amount on a regular basis, without worrying about market tops or bottoms, can produce truly competitive returns.