By: Brandon Rowley
CONSIDER THE FOLLOWING INVESTMENT STRATEGIES:
Strategy 1: An investor puts $1,000 into Treasury Bills on January 1, 1927 and 52 years later on December 31, 1978 his investment has grown to $3,600.
Strategy 2: An investor puts $1,000 into the NYSE index on January 1, 1927 and 52 years later on December 31, 1978 his investment has grown to $67,500.
Strategy 3: Say you can perfectly time the market on a month-to-month basis. You know at the beginning of each month whether or not the stock market will outperform T-Bills that month and you shift your portfolio every month accordingly.
Poll: If you are this perfect market timer, what is the value of your investment 52 years later?
