Have you ever been tempted by newsletters, sooth sayers, channels, websites offering you immense riches by “timing the market”? I bet you have been.

Each year millions of people (worldwide) spend ‘000s of dollars to subscribe to newsletters, email services, sms alerts, phone calls, etc. trying to beat the market. If you see the long term charts of most equity indices, intutively this looks very appealing. There is only one problem, it does not work. This is because the guru of investing late John Templeton says “I do not know of anybody who knows anybody who has made money timing the market”.

Is market timing difficult, NO, it is almost impossible for the common man – so the best thing to do is to stay away. The best 10 days can give you say 55% of the total return for the year! So for whatever reason you stayed away – if you did stay away those 10 days, your returns could be below Savings Bank ratel

One organisation with whom I am associated has many 22 year olds working on technology, news, financial calculators etc. – all this work is somewhat connected to equity markets. Most of these people have a brokerage account – and based on their own knowledge try market timing. It is surely a brokers delight. Most of them do not calculate how much returns they get, so there is no comparison to market returns. Talking to them on a adhoc basis, I know most of them are getting below bank FD rates – at the gross, subject to taxation, as most of the “gains” if any are short term

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  1. The other day I was reading an article that tried to explain everything about market timing.It started like this – “Yes, You Can Time the Market!” 🙂

    After reading all of that, I am sure about one thing…..Market timing really is IMPOSSIBLE, atleast for someone like me!!

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