Terry Smith - manager of a large UK managed fund made this point......
"After all, I suggest, the US stock market is experiencing its longest bull run in history, so surely a change for the worse is more likely than the market climbing higher up the ‘wall of worry’? Smith responds that investors must simply ask themselves which asset classes other than equities offer the prospect of decent gains, and whips out the charts: a £10,000 investment in the US S&P 500 index 15 years ago, left to grow with dividends reinvested, would be worth £41,333 today. That tidy sum represents a 313 per cent increase.
But then comes the killer stat: had you not been invested for the best 10 days in the market during that 15-year period, you would have missed out on profits of £20,460, and gained a more pedestrian 109 per cent. Miss the best 20 days and that £10,000 falls to just £13,629. The 30 best days out of the market see you making a loss of 6 per cent over 15 years. And that’s before inflation."
"After all, I suggest, the US stock market is experiencing its longest bull run in history, so surely a change for the worse is more likely than the market climbing higher up the ‘wall of worry’? Smith responds that investors must simply ask themselves which asset classes other than equities offer the prospect of decent gains, and whips out the charts: a £10,000 investment in the US S&P 500 index 15 years ago, left to grow with dividends reinvested, would be worth £41,333 today. That tidy sum represents a 313 per cent increase.
But then comes the killer stat: had you not been invested for the best 10 days in the market during that 15-year period, you would have missed out on profits of £20,460, and gained a more pedestrian 109 per cent. Miss the best 20 days and that £10,000 falls to just £13,629. The 30 best days out of the market see you making a loss of 6 per cent over 15 years. And that’s before inflation."