Have any of you chased a hot tip, or been impacted by fear and emotions, or thought you could time the market? Those are some of the reasons the average investor loses money. When you have FAITH that the market will go up over the long term; the PATIENCE to let the market do what it has done historically; and the DISCIPLINE to not be impacted by fear and emotions, you can pursue success.
These are attributes that we have all heard throughout our lifetime. If you exercise them in your financial endeavors you will be on track toward success. Allow me to introduce you to some facts you may be familiar with, and this is the Peter Lynch Story. Peter Lynch orchestrated the Magellan Fund from 1977-1990, developing an astonishing 29% average annual return during his tenure. Let me put that in perspective: if you invested $1000 in that fund in 1977, it would have been worth over $27,000 in 1990. However, the average investor in that fund actually lost money! How could that be? Here is another interesting fact: according to a research study conducted by DALBAR from 1985-2005 the S&P 500 returned an astonishing 13.2% annually, yet the average mutual fund investor only made 3.7% during that same period. Do you think that the market corrections of 1987 and 2001 caused a lot of investors to run for cover? And all those that did made their losses permanent and they missed the upside potential.
Market volatility can cause anxiety, sleepless nights, and incorrect decisions caused by emotions. We would welcome the opportunity to help you make smarter decisions, and seek to improve your quality of life.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.