Boston, MA — July 15, 2003 – DALBAR's 2003
update to the Quantitative Analysis of Investor Behavior (QAIB) shows that
investors continue to chase investment returns to the detriment of their
pocket books. Motivated by fear and greed, investors pour money into
equity funds on market upswings and are quick to sell on downturns. Most
investors are unable to profitably time the market and are left with
equity fund returns lower than inflation.
- The average equity investor earned a paltry 2.57% annually; compared
to inflation of 3.14% and the 12.22% the S & P 500 index earned annually
for the last 19 years.
- The average fixed income investor earned 4.24% annually; compared to
the long-term government bond index of 11.70%.
Investors are not swayed by major political events. The market is the
force driving the behavior to hold equity funds for a little over two
years – shorter even than the average for fixed income funds. (from
Dalbar, Inc. press release) |
