Question:
❓Which habit leads to the worst investment results over time?
A) Holding during market drops
B) Not checking your portfolio
C) Panic selling during volatility
D) Investing in index funds
Answer:
✅ C) Panic selling during volatility
The most damaging habit is panic selling—dumping investments when the market drops locks in your losses and makes you miss the recovery that follows.
The average investor underperforms the market not because of what they buy, but because of when they jump in and out. The best days tend to come right after the worst ones, so selling in fear usually means you’re out of the market exactly when it rebounds. From 2005 to 2024 the S&P 500 averaged 10.4% a year—but missing a handful of those best days wrecks it:
| If you missed the market’s… | Average annual return (2005–2024) |
|---|---|
| Nothing (stayed fully invested) | 10.4% |
| 10 best days | 6.1% |
| 20 best days | 3.5% |
| 40 best days | Negative |
Source: J.P. Morgan Asset Management, Guide to Retirement.
This is the whole case for staying invested through the drops—see what missing the market’s best 30 days costs.
