Ideas & Insights

Cost of Missing Best Market Days

Don’t Let Fear Sink Your Long-Term Returns

Timing the market is an extremely challenging Missing the best days can have a significant impact on long-term returns
endeavor for even the savviest investor. It’s difficult to because it’s not just the one, ten, or forty days’ worth of gains that are
forecast the market’s daily gyrations and even more foregone, it’s the missed compounding of those gains.
difficult to trade based on these expectations.

Emotions often drive investors’ trading decisions S&P 500 Hypothetical Growth of $10,000 and Annualized Total Return
(despite best intentions), particularly when Trailing 10 Years (12/31/2008–1/7/2019)
uncertainty and volatility are high. In seeking to
avoid the worst days, many investors sell at or
Fully Invested $34,656
near the lows, and then sit in cash, missing the (+13.20%)
opportunity to participate in any potential market
rebound. Quite often, “best” days occur on the Missed 10 Best Days $21,478
heels of “worst” days. (7.92%)

What happens to your long-term return if you miss

Missed 20 Best Days $15,262
the best days?
(4.31%)

As illustrated in the graph to the right, over the last

10 years—essentially the current bull market—the Missed 30 Best Days $11,363
(1.28%)
annualized return of the S&P 500 Index drops from
13.20% to 7.92% simply by missing the 10 best
days. Miss the 40 best days and the S&P 500 Missed 40 Best Days $8,777
(-1.29%)
actually declined!

Longer-term (12/31/1979–1/7/2019), the S&P Missed 50 Best Days $6,929

500 Index’s annualized return of 11.29% drops (-3.59%)

by approximately 2% when the 10 best days are

missed. Miss the best 40 days and your annualized
return has dropped by more than half to 5.56%.
Source: ©Copyright 2019 Ned Davis Research, Inc. Further distribution prohibited without prior permission. All Rights Reserved. See
NDR Disclaimer at www.ndr.com/copyright.html. For data vendor disclaimers refer to www.ndr.com/vendorinfo/. Past performance
does not guarantee future results. It is not possible to invest directly in an index. Returns are not indicative of the performance of
any AAM product. S&P 500 Index is an unmanaged market capitalization weighted index used to measure 500 companies chosen for
market size, liquidity and industry grouping, among other factors. See reverse for additional important information.

Not FDIC Insured May Lose Value Not Bank Guaranteed Advisors Asset Management, Inc. (AAM) is an SEC-registered investment advisor and member FINRA/SIPC. 1
 ADon’t Let Fear
Brief History of theSink
U.S. Your Long-Term
Financial Markets Returns

Missing each of the best days while participating in all of the worst over any period
of time is extremely unlikely, however this analysis illustrates how significant the
potential negative impact could be should an investor move to the sidelines every
time fear and uncertainty increase market volatility.

By doing so, you may miss the opportunity to participate in any potential market
rebound and as illustrated here, missing the best days has the potential to sink your
long-term investment returns.

Talk to your financial advisor or visit www.aamlive.com to learn about potential

investment opportunities in a volatile environment.

Visit www.aamlive.com or contact your financial

advisor to learn more.

All investments involve risk; principal loss is possible.

Unless otherwise stated, all information and opinions contained in this publication were produced by Advisors Asset Management, Inc. (AAM) and other sources believed by AAM to be
accurate and reliable. However, third party sources cannot be guaranteed as to accuracy or completeness. Due to rapidly changing market conditions and the complexity of investment
decisions, supplemental information and other sources may be required to make informed investment decisions based on your individual investment objectives and suitability specifica-
tions. All expressions of opinions are subject to change without notice. These opinions are not intended to be a forecast of future events, a guarantee of future results, or investment advice.
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