The Big Mistakes

Updated 06/16/14

It seems so simple. Make one market timing error every 5-years .  .  . just modest errors .  . . not the worst possible errors.

Mistake #1: Be a little slow entering bull markets. The red tics show where a Bull appeared on a business major magazine cover. The green tics coincide with the dates of  a Bear appearing on the cover of a major magazine. Taking that magazine cover's advice converts a 19.6% annualized return to a 15.07% return. This is a reduction in total return over 120% over ten years . . . MORE than your original investment.

By the time you see it in print, it's History  . . . not investment advice.

Mistake #2: Go to money market instead of finding an issue that looks more promising.Many issues grew in the 1994 "flat market". In the 1990 bear market, it was tougher to find good investments. Stock and sector fund ranking offers good opportunities when strong, broad market trends falter.

You can't win the game by staying on the sidelines.