“Research Takes You Out of the Emotion of the Moment”

Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:

“ I saw people begin to question Buy-and-Hold in a serious way in the days when the CAPE had dropped to 13. There were people at the Bogleheads Forum flat-out calling Taylor Larimore a liar. That was unimaginable in the days before the crash.”

Those are market timers. We can just look at history and see that Buy and Holders have done extremely well as the held their stock and continues to buy.

These were ardent Buy-and-Holders before prices fell.

Are you saying that Taylor Larimore is a market timer? Before prices fell, he said that he would never sell. Then after prices fell he said that he needed to reconsider. Get Rich Quick strategies are not nearly as appealing after the pretend money disappear.

Check with the people who bought into the Bernie Madoff fund. They said that their strategy performed “extremely well” too before his fraud was exposed.

This is the benefit of looking at peer-reviewed research. Research takes you out of the emotion of the moment and helps you to focus on what works best in the long term.

Rob