The Cost of Trying to Time the Market

The impact of being out of the market for a short time can be profound, as shown by this hypothetical investment in the Russell 3000 Index, a broad US stock market benchmark.

  • A hypothetical $1,000 investment made at the beginning of 1999 turns into $6,449 for the 25-year period ending December 31, 2023.
  • Miss the Russell 3000’s best week, and the value shrinks to $5,382. Miss the best three months, and the total return falls to $4,546.
  • There’s no proven way to time the market— targeting the best days or moving to the sidelines to avoid the worst.

Staying invested and focused on the long term helps to ensure that you’re in position to capture what the market has to offer.

Past performance is no guarantee of future results. Indices are not available for direct investment. Their performance does not reflect the expenses associated with the management of an actual portfolio.

In USD. For illustrative purposes. Best performance dates represent end of period (November 28, 2008, for best week; April 22, 2020, for best month; June 22, 2020, for best three months; and September 4, 2009, for best six months). The missed best consecutive days examples assume that the hypothetical portfolio fully divested its holdings at the end of the day before the missed best consecutive days, held cash for the missed best consecutive days, and reinvested the entire portfolio in the Russell 3000 Index at the end of the missed best consecutive days. Frank Russell Company is the source and owner of the trademarks, service marks, and copyrights related to the Russell Indexes.

Dimensional Fund Advisors LP is an investment advisor registered with the Securities and Exchange Commission.

Investment products: • Not FDIC Insured • Not Bank Guaranteed • May Lose Value Dimensional Fund Advisors does not have any bank affiliates.