Reinhardt Gert Coetzee @reinhardtcoetzee: "Hey everyone, Yesterday's dramatic market movement..."

South Africa

Hey everyone, Yesterday's dramatic market movement saw the Nasdaq $NSDQ100 with its biggest one-day gain since January 2001. The S&P 500 $SPX500 had it's biggest one-day gain since 2008. 𝗧𝗵𝗲 𝗛𝗶𝗴𝗵 𝗖𝗼𝘀𝘁 𝗼𝗳 𝗠𝗶𝘀𝘀𝗶𝗻𝗴 𝘁𝗵𝗲 𝗠𝗮𝗿𝗸𝗲𝘁'𝘀 𝗕𝗲𝘀𝘁 𝗗𝗮𝘆𝘀: Over the past 20 years, the S&P 500 has delivered an average annual return of approximately 9.7% for those who remained fully invested. However, missing just a handful of the best-performing days drastically reduced these returns: -Missing just the 10 Best Days reduced the average annual return to about 5.5%. -Missing the 20 Best Days: Reduced it to approximately 2.8%. -Missing the 30 Best Days: Results in a 0.7% annual return. -Missing the 40 Best Days: This leads to an average annual loss of around 1.2%. It's striking to note that many of these best days occur shortly after significant market downturns. For instance, six of the seven best days between 2000 and 2020 happened within two weeks of the worst days. This pattern highlights the difficulty of market timing. Attempting to sidestep the lows often means inadvertently missing the highs that follow closely behind. While it's natural to feel uneasy during market volatility, history suggests that maintaining a long-term perspective and staying invested can be more beneficial than attempting to time the market. Best, Reinhardt

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NSDQ100

SPX500

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