Proof That Time In The Market Beats Timing The Market

Aug. 17, 2022 9:47 AM ET10 Comments
Kent Thune profile picture
Kent Thune
789 Followers

Summary

  • The perils of market timing are well-documented, and I share recent studies confirming the adage "time in the market beats timing the market."
  • What makes timing the market difficult is that many of the best days occur in bear markets or recessions and some of the worst days occur during bull markets.
  • For the most recent evidence, consider the past month ending Aug. 15, 2022, when the S&P 500 gained 11.35%, which is more than the average annual gain for stocks.
  • For long-term evidence that time in the market beats timing the market, I share data going back 30 years.

time - business trade

deliormanli

What Is Market Timing?

Market timing is an investment strategy of timing the sale or purchase of securities to maximize returns or minimize losses. Thus, market timing may be generally associated with a "buy low, sell high" strategy. For example, if an investor believed that stocks

This article was written by

Kent Thune profile picture
789 Followers
Kent Thune, CFP®, is a fiduciary investment advisor specializing in tactical asset allocation and portfolio management with a focus on ETFs and sector investing. Mr. Thune has 25 years of wealth management experience and has navigated clients through four bear markets and some of the most challenging economic environments in history. As a writer, Kent's articles have been seen on multiple investing and finance websites, including Seeking Alpha, Kiplinger, MarketWatch, The Motley Fool, Yahoo Finance, and The Balance. Mr. Thune's registered investment advisory firm is headquartered in Hilton Head Island, SC where he serves clients all around the United States. When not writing or advising clients, Kent spends time with his wife and two sons, plays guitar, or works on his philosophy book that he plans to publish later in 2022.

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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