“There has literally never been a 20-year period in the past century or so that has resulted in a negative return for stocks, so investors with the patience and constitution to see their portfolio through an admittedly rough start to the year should be rewarded regardless of the gloom and doom.”— Marketwatch.com (1/15/16):
You can’t predict what the market will do. No one can. But you can stack the odds in your favor. One way is by Respecting the Time Factor.
Stocks will fluctuate. It’s a fact. They go up, they go down. Even the very best will take some tumbles. But market fluctuations only matter when you sell your holdings. It’s the Rule of the Roller Coaster: You only get hurt when you jump off.
You can protect yourself by Respecting the Time Factor.
- Money you’ll need in the next 3 to 5 years should be in cash (so you don’t have to sell when the market is down).
- Money you’ll need in 5 to 10 years can be in conservative stocks and bonds.
- Money you won’t need for 10+ years can be in more volatile stocks, bonds, real estate or even commodities, because you have more time to ride out the highs and lows.
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