St Louis Fed Study Shows That Chasing Stock Returns Is Poor Strategy

Many investors chase returns in the equity market.  They increase investments in mutual funds when stock prices have increase and they sell when performance deteriorates. That is a losing strategy. Investors who buy and hold mutual funds earn a 5% annual return during 7 year periods.  That implies a 40% return over the period.  This study confirms the views of investors like Warren Buffet who does not try to time the market.  He buys stocks that represent a good value,  and he holds them as long as the firm maintains its strategic position in an industry.  I doubt that Buffet watches CNBC.