“People are always hopeful that they can time the market, and most people try and time the market based on emotion rather than logic,” said Olivia Engel, chief investment officer of State Street Global Advisors’s active quantitative equity team. “From a couple of decades of investing, I would say that timing the market is just really hard and if it was easy, we’d all be very rich.”
As hard as it is, that hasn’t stopped investors from trying. Bears, in particular, haven’t given up on their calls for the S&P 500 to crash, potentially revisiting its March low.
If history is any guide, that scenario may not play out when stocks have gone this far in a rebound. During the eight market cycles since World War II, only once did the S&P 500 come within 5% of its bear market trough after three months had passed, as is the case now, according to a study by BMO Capital Markets.
“You can’t buy it one day and sell it the next and think you can outfox the market. You can’t do that,” said Gary Bradshaw, a portfolio manager at Hodges Capital Management in Dallas. “The way you make money in the market is you buy good companies and you hold on.”
--With assistance from Amena Saad.
This article was provided by Bloomberg News.