Time in the Market vs. Timing the Market: Missing the 10 Best Days Costs You More Than Half Your Money
6 min read
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6 min read
Imagine you put $10,000 into the S&P 500 twenty years ago and never touched it again. On the latest available data, that money would have grown to roughly $75,000, a 10.60% annualized return. Now imagine you did the same thing, except you got spooked during a downturn, sold, and by the time you felt safe again you had missed just the ten single best trading days out of those 20 years, roughly 5,000 trading days in total. Your $75,000 would have shrunk to about $34,000. That is the entire time in the market vs timing the market argument in one number: ten days decided whether you kept more than half your money.
This is not a rounded-off internet claim. It comes from J.P. Morgan Asset Management's "Guide to the Markets," which tracks what happens to a $10,000 S&P 500 investment over the trailing 20 years if you miss the market's single best days, using Morningstar Direct data on daily S&P 500 returns, current as of 28 February 2025. Here is the published annualized return for each scenario, plus what that rate actually does to $10,000 over 20 years of compounding:
| Scenario | Annualized return (20 years) | $10,000 grows to |
|---|---|---|
| Fully invested, no days missed | 10.60% | ~$75,000 |
| Missed the 10 best days | 6.37% | ~$34,400 |
| Missed the 20 best days | 3.69% | ~$20,600 |
| Missed the 30 best days | 1.53% | ~$13,500 |
Look at the gap between the first two rows. Staying fully invested turns $10,000 into a $65,000 gain. Missing just 10 days, out of roughly 5,000, cuts that gain to about $24,400, keeping less than 40% of the profit. Miss 30 days and you are barely ahead of what a bank deposit would have paid you over the same 20 years, for having held the single riskiest asset class in the comparison.
The reason this is so hard to avoid by accident, and nearly impossible to avoid on purpose, is that the market's best days and worst days tend to sit right next to each other. March 2020 is the cleanest real example on record. On 12 March 2020, the S&P 500 fell 9.5%, one of the worst single days in the index's history. The very next trading day, 13 March 2020, it rose 9.3%, one of the best days in the index's history. A few days later, on 16 March 2020, the index fell 12%, and just over a week after that, on 24 March 2020, it rose 9.4%.
Anyone who sold after the 12 March or 16 March drops, a completely understandable reaction, had to buy back in within a day or a week to catch the rebound that followed. Most people who sell during a crash do not get back in that fast. They wait for things to feel safe again, and by the time they do, the best days have usually already happened.
The logic of missing-best-days data is not that selling is always wrong. It is that selling and buying back at the right two moments is a much harder problem than it sounds. To beat a fully invested portfolio, a market timer has to be right twice: right about when to get out, and right about when to get back in, and both calls have to happen close enough to the actual worst and best days to matter. Getting the first call right and the second call even a week late is enough to land you in the "missed 10 best days" row of the table above, not the "fully invested" row.
This is also why the missed-best-days test is not really about predicting crashes. Plenty of people correctly predicted the 2020 crash was coming. Far fewer got back in by 13 March.
The same mechanism shows up in the IHSG, and arguably harder, because Indonesia's index swings more than the S&P 500's. NetWort's own analysis of sequence of returns risk documents that IHSG fell roughly 50.6% over 2008 and then rose about 87% the very next year, one of the sharpest one-year rebounds in the index's history. An investor who sold out of an IHSG-heavy portfolio partway through 2008 and waited for the news to feel better before buying back in had every chance of missing a meaningful slice of that 2009 recovery, for the same reason the S&P 500 example above works: the recovery arrives while the outlook still feels uncertain, not after it clears up.
For a global portfolio, this same S&P 500 data still applies directly. The index itself is trackable on NetWort as GSPC, and it is accessible to Indonesian investors today through funds like the SPDR S&P 500 ETF Trust, which holds essentially the same 500 companies in the same weights as the index.
Nobody can know in advance which ten days of the next 20 years will matter most, which is exactly the point of this data. What you can actually check is how long your own money has been invested and what it has really earned given the exact dates you put it in and took it out. NetWort's Dashboard calculates your portfolio's real IRR, your actual money-weighted annualized return, not a hypothetical one, so you can see where you stand before deciding whether stepping out of the market for a while is worth the risk this data describes.