There is an old quip to describe the cost of market timing.
Q: Why is your portfolio like a bar of soap?
A: The more you touch it, the smaller it gets!
Consider the enormous performance gap between long-term buy and hold vs the average investor’s results from market timing:
Wow!
And that doesn’t even account for taxes or the cost of transactions.
Not to mention time spent trading.
The average investor benefitted from simply holding a balanced portfolio, or got further ahead just owning bonds! In fact, their pre-tax results barely even beat inflation:
These results are startling! But they are actually predictable.
Market volatility is difficult to navigate. Investors are bombarded with headlines encouraging them to panic. It is no wonder they consistently move in and out of financial markets at precisely the worst times.
If you don’t want to make these worrisome decisions, we have another approach for you.
Our “pension-style” portfolios can help you sleep at night!
And avoid…the huge cost of trading.
Your CommonWealth Team
