Time In, Not Timing: Why Staying Invested Beats Trying to Predict the Market
Time In, Not Timing: Why Staying Invested Beats Trying to Predict the Market
During periods of market volatility, it can be tempting to “get out” to manage risk. But evidence from Canadian and global investing shows that the real risk is being out of the market rather than being in it.
Let’s look at the illusion of timing vs the power of time. Attempting to sell before downturns or buying when you think the bottom is forming is known as market timing, and the chances of getting it right are slim. Time in the market is the practice of holding investments across cycles, which generally results in a higher probability of success.
No one likes to see any kind of decline when it comes to their money. It’s natural to feel uneasy when markets move, but selling in response to fear may not only lock in losses, but could result in missed recovery opportunities, especially for those in or near retirement. It may feel proactive, but selling to avoid a downturn can reduce your runway for growth or impact future income-generation.
In fact, according to Hartford Funds, “78% of the stock market’s best days have occurred during a bear market or during the first two months of a bull market. If you missed the market’s 10 best days over the past 30 years, your returns would have been cut in half. And missing the best 30 days would have reduced your returns by an astonishing 83%.”
Taking a disciplined investing approach — staying diversified, keeping your asset-allocation aligned with time horizon, using regular contributions — helps manage risk more effectively than jumping in and out of the market.
Five ways to stay disciplined over the long term:
- Define your investment horizon and keep it front of mind (e.g., retirement date, business exit timeline).
- Maintain a core diversified portfolio rather than reacting to market noise.
- Use automatic contributions to smooth market timing risk.
- Avoid trigger-based liquidations unless circumstances change (not just fear).
- Review periodically; adjust for life changes, but avoid frequent “market timing” trades.
When you sell in uncertainty, the cost isn’t just the drop, it’s the opportunity cost of missing the bounce-back. Time in the market offers the structural advantage of compounding, recovery, and growth. Rather than reacting to short-term fears, align your portfolio with your long-term goals and let time work for you.
Reach out if you’re concerned about how your portfolio is responding to market ups and downs.
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