Market timing is considered a method to make money fast, a get rich quick scheme where in a matter of minutes you can get returns on your money. However, like most of these make quick, easy money plans, it is too good to be true.
After making the big assumption that you can pick the best investments to shuffle your money between, market timing is supposed to get you a larger short-term return than long-term investing. However, it takes a rare individual and a lot of luck to make market timing work as a successful method of making money.
Instead, a steady investment in a diversified asset allocation will provide a higher, safer return over the long haul. That’s why this kitten doesn’t time the markets. She instead works with her fee-only financial planner to make a long-term asset allocation that will provide the return she requires.
Then, her money takes a smoother ride rather than the bumpy lottery of market timing.
Way to go, kitten!
Read all the Kittenomics here!
To read more about this topic check out Timing the Market Isn’t All Fun and Games.
Photo of Pesto taken by chispita_666 and used here under Flickr Creative Commons.