If you have long-term investments in the stock market, the best thing you can do is turn off CNBC and forget about them. A long-running study of investor behaviour dating back to 1984 shows that individuals do much worse than the market.
Over the last 20 years, for example, the S&P 500 index has returned an average of 9.22% per annum, but the typical investor has netted just 5.02%.
Along the same lines, The Reformed Broker laments how difficult it is to sit on the sidelines in a portfolio of 100% stocks because of the painful swings.
