When is the Best Time to Invest?
If you are looking to invest for your future with a five-, ten- or thirty-year time horizon, then now is as good a time as ever to invest.
Waiting for a pullback in stocks with a long-term time window is not going to make an enormous difference. If the market could predict a crash in stock prices, a crash would never actually occur. More importantly, missing out by sitting on the sidelines has proven to be a significant detriment to long-term returns.
Don’t time the market
Some of the best investors in history had no interest in timing the market. They understood that any “timing” benefit you might see in the short term is mitigated by time – and the risk of missing out on the best days of market performance throughout the years puts your long-term investment performance at risk.
Keys to successful investing comes down to the basics.
Waiting for a pullback in stocks with a long-term time window is not going to make an enormous difference. If the market could predict a crash in stock prices, a crash would never actually occur. More importantly, missing out by sitting on the sidelines has proven to be a significant detriment to long-term returns.
Have a plan. What are you investing for? What is your time horizon? Is this a one-time investment, or do you plan to keep adding to it regularly?
Understand volatility. Market values go up and down every day. Some stocks are more volatile than others. No one can predict what is going to happen tomorrow. Work with your portfolio manager to understand how your asset mix is structured to temper market fluctuations.
Engage a team of professionals. An Accountant to provide tax advice, a Portfolio Manager to manage the day-to-day investment decisions, a Financial Planner to design a plan to help you accomplish your goals and objectives, an Insurance Specialist to help you mitigate the risks in your plan and a Lawyer to ensure you have protected yourself, your wealth, and your family.
Diversify. Investing across different asset classes
and market sectors can help mitigate market
forces that only impact certain industries. Paragraph
Think long term. The price you pay today won’t have a huge impact on your long-term returns. It certainly won’t have as big of an impact as missing out on just a few of the market’s best days. Investing regularly and continuously helps to level out the ups and downs by buying into
the market during peaks and troughs, thus averaging your costs.
Expect to be wrong sometimes. You are not going to be “right” all the time. That is another reason why it is important to spread out your
investments among several companies and sectors. Inevitably you will contribute to your portfolio, and the market will go down. It is during these times that you need to stick to the plan and remember you are investing, not speculating.
When investing for the long term, it is important not to worry about buying at the absolute lowest point. A disciplined approach, a sound strategy, and the right advice will help you meet your financial goals far more than attempting to time the market. Invest early, invest often.
Have Questions?
Contact a Ward & Uptigrove Wealth Management representative
at 519-291-3040 or email info@w-u.on.ca.
