Investing in stocks can be intimidating due to their inherent volatility, especially with individual stocks. However, if you take a long-term approach, the risk of losing money diminishes significantly. The S&P 500 index, which tracks 500 of the largest U.S. companies, showcases this trend. Historically, there’s a 94.6% chance of positive returns over a 10-year investment period, and this probability rises to an impressive 99.8% over 20 years. With an annualized return of approximately 10%, the S&P 500 has consistently delivered solid growth for investors. Yet, many investors only see around 4% returns. Why is that? The answer lies in emotional investing; many panic during downturns, buying high and selling low, ultimately missing out on the substantial gains that long-term holding can provide.
Comments