Perspectives on the long term and this time feels different.

I’m not a big poster but I put this together in response to someone saying that this time feels different. The source of the information comes from some literature I’ve accumulated. I would also like to say that this is a post on investing and not on trading.

At the bottom of the market in 1987 (Black Monday you dropped 22% 10/19/87) you would’ve lost 29% of your portfolio. By the end of 1989 you would’ve been 25% higher than your peak portfolio value in 1987. Missing the best days in the market (S&P 500) also substantially reduce your returns. For example if you were invested every day from January 1998 through December 2017 (sorry this year isn’t over yet can give you a number) you’d have an average return of 7.2%. If you miss the best 10 best positive days your return is only 3.5%. If you miss the 20 best days your return is just 1.1%. And if you panic and sell when things get bad and miss the 30 best days, just one months worth of the market over the course of 20 years you would have an average return of -0.9%.

That’s the cost of dumping your stocks. And just to be proactive to the criticism let it be known that buy and hold does not mean buy and forget.

Submitted December 24, 2018 at 09:58AM by buffaloop567 http://bit.ly/2ENp76e