No. of Recommendations: 3
Oy! I don't know about you but it. Is nrver in my plans to lose half my money.

Nobody "plans" to lose half their money. But that's where one's belief in statistics comes into play.

An occasional fallback is part of the way the world works. That's why football games go on for 60 minutes and don't stop the first time that one team falls behind the other in points.

The statistics of the S&P500 are that the long-term average return is 11%/yr. An occasional individual year has a loss of ~20%. An occasional individual year has a *gain* of ~40%. The worst ever year had 43% loss, the best ever year had a gain of 60%.

The strategy that gives you the 60% gain also sometimes gives you 40% loss. If you want the 60% you have to put up with the -40%.

If you don't understand the statistics, you do something that avoids the 40% loss AND the 60% gain. Lots of people don't understand the statistics, and that's why there are lots of people who retire with Social Security as their primary source of income.

FWIW, some more stats:
For plain B&H of the S&P500,
5% of the years had loss of 15% or more.
95% had gain of 38% or more.
To recover from a 15% loss requires a gain of 18%. 38% is more than 18%.

For a dead-simple moving-average timing strategy on the S&P500:
5% of the years had loss of 5% or more.
95% had gain of 36% or more.
To recover from a 5% loss requires a gain of 5.3%. 36% is more than 5.3%.
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