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Time, Not Timing: Staying the Course with Your Investments
February 19, 2024

Time, Not Timing: Staying the Course with Your Investments

Investment Education, Financial Planning
  • Achieving your long-term financial goals can take patience to allow investments to grow upon themselves through re-invested earnings and dividends.
  • “Timing” when investments will rise or fall and selling and buying them based on predictions takes significant diligence and rigor and risks missing out on the potential best growth days of the investments.
  • Consistent, steadfast time in the market has historically produced exponential growth.

“Buy low, sell high.” This long-time investing mantra – which also applies to purchasing homes, antiques, art, baseball cards, and more - is obviously the ideal scenario to help make the most of your money. If only it were that simple.


The missing variable is “time;” when exactly to buy and when exactly to sell. This is referred to as “Timing the market,” or “market timing,” and is one of two common strategies investors use to make the most from their investments. The other strategy is referred to as “time in the market.”

Timing the Market

Timing the stock market successfully requires predicting the best times to buy and sell stocks based on specific factors related to the investment itself, economic indicators, market trends and even emotion. The strategy requires much more active involvement, including diligent research and analysis of a range of variables that could impact the stock’s value. Even if someone is extremely active and involved with their investments, it’s considered a much riskier approach than “time in the market.”

Risks include:
  • Predictions not panning out
  • Selling an investment too soon only to miss out on days when the value increases
  • Buying an investment thought to be at its low, only to see it slide further or not grow
  • Missing out on dividends after an investment is sold
  • Missing out on compounding of earnings and dividends by selling it
  • Incurring transaction fees, commissions and taxes after selling

Time in the Market

Time in the market is generally considered a safer strategy for investors who seek long-term growth. It focuses on consistently investing over longer timeframes, and not selling the investments, regardless of the ups and downs of the market.


Investors who keep their investments in the market can capitalize on the fact that the stock market tends to deliver positive returns over extended timeframes. Investors can invest in diversified portfolios with a mix of stocks, bonds and mutual funds, and make periodic contributions without actively engaging in regular buying or selling. This allows them to benefit from compounded earnings and dividends, and dollar-cost averaging (consistently investing a constant dollar amount through all different market conditions - resulting in various purchase prices because you bought them at different times) because their money stays in the market and grows upon itself.


The S&P 500 grew by 24.4% in 2023.1 If someone missed out on the 10 best days, they would have missed out on 18.3% of that growth. Let’s illustrate this in real dollars if someone invested $10,000 on January 1, 2023.


Invested $10,000 on January 1, 2023
Gave the $10,000 "time" in the S&P 500 for the entire year
 Missed out on top 10 growth days of S&P 500 by "timing" the market
Rate of Return 24.4%1 6.1%
Value at End of 2023 $12,440 $10,610


Staying in the market and letting earnings and dividends achieve compounded growth has historically produced more than a 10% return on investment in the history of the stock market.2 Timing the market can increase risk of missing out on some of the best growth of the market.


At Wealth Management by CommunityAmerica, we aim to help you reach your financial goals. Remember that all investments involve risk, and it's crucial to align your investment goals and strategy with your risk tolerance, financial situation, and long-term objectives. Schedule a complimentary consultation with a Wealth Management by CommunityAmerica Wealth Advisor today.

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About the Author
todd salzman
Todd Salzman

Wealth Management by CommunityAmerica

As a CommunityAmerica Wealth Advisor, Todd's goal as your financial partner is to build a holistic plan that can help you achieve your desired financial future, regardless of where you are in your stage of life.

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