The impact of missing just a few of the market’s best days can be profound, as shown by this animated look at a hypothetical investment in the stocks that make up the S&P 500 Index. The short one-minute Dimensional video below is based on the total return of the S&P 500 Index from January 1, 1990, to December 31, 2020. So, investing for 30 years in the Index – or for over 10,000 days.
The video highlights what the return difference would have been if you missed a few of the large Index return days over this entire 30-year span. You will likely be surprised at the significant impact.
The impact of missing just a few of the market’s best days can be profound, as this video showed in a hypothetical investment in the stocks that make up the S&P 500 Index shows. Staying invested and focused on the long term helps to ensure that you’re in position to capture what the market has to offer.
• A hypothetical $1,000 turns into $20,451 from 1990 through 2020.
• Miss the S&P 500’s five best days and the return dwindles to $12,917. Miss the 25 best days and that’s $4,376.
• There’s no proven way to time the market—targeting the best days or moving to the sidelines to avoid the worst—so history argues for staying put through good times and bad.
Missing only a few days of strong returns can drastically impact overall performance.
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