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Basic investing concepts and statistical information for new investors

Investment Basics

The Greatest Challenge of Market Timing: GETTING IT RIGHT TWICE

How missing the best month can hurt your returns.

The Result of Not Being Invested During the Best Returns Each Year in the S&P 500 Index (12/31/1996 - 12/31/2015)

Source: Morningstar Direct. The S&P 500 Index is an unmanaged index which is widely regarded as the standard for measuring the U.S. stock market performance. It represents the 500 most widely held public companies in the U.S. Returns assume reinvestment of dividends and do not include taxes or transaction charges. It is not possible to invest directly in an index. Past performance does not guarantee future results. Information contained herein has been obtained from sources believed to be reliable, but is not guaranteed. The information provided is for illustrative purposes only and is not meant to represent the performance of any particular investment. Investing in equities involves risks, including the possible loss of principal amount invested. An investor’s securities, when sold, may be worth more or less than their original cost.

 

Why STAY INVESTED?

Missing the best trading days may have a significant impact on your returns.

Hypothetical Growth of a $10,000 investment from 1/1/06–12/31/15 (based on S&P 500 Performance)

Source: Morningstar Direct 

These calculations are based on the growth of a $10,000 investment between 1/1/06 and 12/31/15 in the S&P 500 Index, assuming reinvestment of all dividends. The S&P 500 Index is an unmanaged index which is widely regarded as the standard for measuring the U.S. stock market performance. It represents the 500 most widely held public companies in the U.S. It is not possible to invest directly in an index. Past performance does not guarantee future results. Information contained herein has been obtained from sources believed to be reliable, but is not guaranteed. Index performance is shown for illustrative purposes only and is not meant to represent the performance of any particular investment. Investing in equities involves risks,  including the possible loss of principal amount invested. An investor’s shares, when sold, may be worth more or less than their original cost. Taxes, fees and expenses have not been taken into consideration for the purpose of this illustration.

 

A History of POSITIVE RETURNS

Since 1935 the S&P 500 Index has experienced 77 years of rolling 10-year positive returns and 4 years of negative returns. The following illustrates the 10-year rolling returns for the S&P 500 Index from 1935-2015.

Source: Morningstar Direct 
Past performance does not guarantee future results. The return of principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Index performance is shown for illustrative purposes only and does not predict or depict the return of any investment. The S&P 500 Index is abroad-based measure of domestic stock market performance that includes the reinvestment of dividends. Indices are unmanaged, include reinvested income and cannot be purchased directly by investors. Index returns do not include any sales charges or fees an investor would pay to purchase securities. Such costs would lower performance.

Market volatility can significantly affect short-term and long-term performance. Portfolios are subject to market fluctuations and economic conditions. Portfolios and assets may lose value. Every investment has the potential for loss as well as profit. Information contained herein has been obtained from sources believed to be reliable, but is not guaranteed.

Investing Terms Glossary

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