This 1 Investing Mistake Is Quietly Destroying Your Long-Term Returns. Here's What to Do Instead.

Written by David Dierking for The Motley Fool->

Long-term buy-and-hold investing is often the best path to wealth creation.

Unfortunately, many people try to time the market along the way, only to miss the inevitable rebound when stocks recover.

Investors should focus on capturing the long-term economic growth story rather than trying to figure out what's going to go up and down and when.

People spend so much time thinking about and trying to identify the best stocks and ETFs that they usually forget about the one thing that can be most damaging to their returns: themselves.

Most investors start with good intentions. They'll establish a reasonable portfolio allocation and plan to hold on to it for years. The problem arises when there's a market correction and people find they're more risk-averse than they thought.

Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »

That usually results in people selling their stocks at the wrong time, which is after they've already gone down. "I'm going to wait until things get better" is a common refrain. The problem is that this usually means they only buy back in after the recovery has happened.

In other words, this is textbook "sell low, buy high," which is exactly what you don't want to do when investing for the long term.

Investors who buy stocks or other risk assets need to be prepared for volatility. It's simply the price of admission when putting your money in these things. Studies have consistently shown that the average equity fund investor usually experiences lower returns than the underlying investment itself. The primary cause is poor timing with buying and selling.

In order to actually profit from market timing, investors would need to get two decisions correct: when to sell and when to buy back in. Most investors (and even professional money managers) struggle to do either consistently. It requires a level of discipline and luck that few are able to manage.

That's why successful investing often involves just being invested! It's about participating in the long-term economic and earnings growth story and then letting time compound the returns for you.

Trying to avoid downturns is natural. But understanding that staying the course is more important is the path to long-term success.

When our analyst team has a stock tip, it can pay to listen. After all, Stock Advisor’s total average return is 883%* — a market-crushing outperformance compared to 205% for the S&P 500.

They just revealed what they believe are the 10 best stocks for investors to buy right now, available when you join Stock Advisor.

*Stock Advisor returns as of June 27, 2026.

The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This data feed is not available at this time.