markets
The Market Always Rises
The rule
Over long years the whole market climbs past every crash, like a river that keeps rising.
Where it flips
This is true for a broad, spread-out index, not for one lucky stock that may sink forever. The repair is to own the whole market, and to remember 'long' means decades, not months.
A broad market index falls many times. But over ten, twenty, thirty years it keeps climbing higher. The slow upward drift is the whole reason buying and holding works. You do not need to guess the good days. You just need to stay in your seat and not sell in fear.
A worked example
Aarvi's index fund dropped 30% in one bad year. She held on. Fifteen years later it had more than tripled. [illustrative]
How to spot it
- ·You sell in a crash instead of holding
- ·You judge a fund by one bad year
- ·You forget your money has 20 years to grow
J. L. Collins · The Simple Path to Wealth