Is Trying to Time the Market Worth It?
Trying to time the market means trying to pick a time to buy your stocks, bond or etfs. So instead of buying when they have cash available, an investor waits and holds cash waiting for an opportunity to buy low.
Does this strategy work?
No. It’s too hard to do and not even the “pros” can’t do it consistently. Furthermore, even if you are good at timing the market, the benefits of doing so are modest and therefore not worth the risk.
Instead of trying to figure out the best day to buy each year – a virtually impossible task – investors might be better off looking for ways to reduce fees, taxes and other trading frictions.
Instead of worrying about market timing, most investors would be wise to contribute to their portfolios regularly”
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I’m a department head for a high school in Toronto. I graduated from the Ivey School of Business at Western University and have been a DIY investor for over 20 years.