Timing the market is a mug’s game. Trying to spot when a market has hit bottom or top and leap to another is prohibitively difficult, and it costs money. In the long run, all that happens to market-timers — unless they are very, very lucky — is that they spend much more in trading costs and end up worse off than if they had stayed put all along.
That is where I stand. And that is an issue because, as some alert readers have pointed out, much of this column implicitly aims at showing readers how to time the market. Is this month’s correction the beginning of a bear market? That is a question of market timing and I have written a lot about it.
Not only that but the investment industry is now geared up to help you time the market. Exchange traded funds tracking indices and allowing you to trade in and out of the market each minute make no sense unless they are vehicles for market-timing. And they are the hottest investment product.