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A $500,000 investment in an S&P 500 index fund on
March 9, 2009 would have grown to approximately
$2,380,000 if left untouched over that period of time.
Section 3

DELETE THE 1 Start a new paragraph with the word
Letting Emotions Guide Your
unfortunately.
Investment Decisions

2019
476%

Since dropping to a bear market low of 676.53 on March 9, 2009,

the S&P 500 gained approximately 368% up to December 31,
1
2018. Unfortunately, many people who previously invested in
stocks or stock mutual funds haven’t been around to see those

gains. Investors pulled billions of dollars out of the stock market

as it neared the bottom, and many have yet to return.
but any turbulence or market volatility sends investors
This type of investor behavior is not new – it’s the norm.
running for the exits.
The average investor is constantly moving their investments in
the wrong direction. They move money into stocks when the
market is going higher. The higher the market goes, the more

enthusiasm investors seem to have for stocks, particularly

“hot” funds that have done well in the last year or so. Don
Phillips, president of fund research for Morningstar, said: “Many
companies encourage bad investor-behavior by launching

funds in hot sectors. This induces investors to buy near peaks.” 5

This chart shows that investors move money out of the market to
try to avoid losses, and end up missing out on big gains over the
long-term.

Chapter 4: The Most Common Investor Mistakes