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SFB037 Illusions of Investing Part 3 - Timing is Everything.... NOT

| October 11, 2016
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Episode Summary

Paul Adams is back with another myth-busting podcast session. This episode is part 3 of 6 on investing illusions. Can you time the market? Do you know when is the best time to buy-in or sell-out? Chances are you'll lose more money trying to play the market than if you simply stuck with it. So, why are major publications trying to constantly have you move your money out or in? It boils down to advertisers! Find out more about this illusion on this week's podcast.

What Was Covered

  • 02:25 - Let's look at the performance history of the market.
  • 03:00 - If you bought the S&P 500 in 1984 and sold it in 2013, that index would have given you a 11.1% return.
  • 03:35 - Your average investor in equity-based mutual funds does about a 3.69% return.
  • 05:00 - Paul gives a quick example of how big of a difference 11.1% is compared to 3.69%.
  • 06:30 - Between 1993 to 2013, your rate of return would have been 8.6%, if you stayed in the market during the ups and downs. If you tried to 'market time' it to your advantage, you would have had 6.45% rate
  • 10:00 - Why is it that major magazines and financial TV channels want you to have your money on the move instead of riding the market's waves?
  • 11:35 - Every time you move your money, an advertiser benefits.
  • 12:15 - Paul talks about a Playboy Playmate who appeared on national news for being a day trader.
  • 13:25 - What's on TV is just for entertainment, not for education.
  • 15:35 - We can not predict the future.
  • 17:00 - So few people are really able to get out of the market at the right time and get back into the market at the right time.
  • 17:15 - Look out for part 4 on investing illusions!


"The people are glued to the screen because there's always some doomsday event of something falling apart."

"Every time we talk about getting people to move their money, that works out better for an advertiser."

"The TV network's job is not to have you have financial success. Their job is to engage your eyeballs."

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