Spend time in the market rather than timing the market

After having hit their record highs in October, the equity markets have moved sideways in small bout of volatility. Investors, would be nervous of the market levels and the recent volatility, what if it is a bubble? What if the third wave of the pandemic lashes? Should one exit while the going is good?

Our analysis shows that such questions become irrelevant when one is focused on the long term. Long-term investing negates the fear of market timing – both entry and exit – creating wealth over time. The analysis considers the following scenarios.

• For the high and low scenarios, returns for 1 year and 3/5/7/10/15 years are computed and the averages, maximum and minimum returns analysed
• In case of investment at any point of time, all the periods are analysed to generate the average, maximum and minimum returns