The Daily Dow
Tuesday, July 9, 1996
by Robert Sheard

LEXINGTON, Ky. (July 9): One of the most frequently asked questions by readers of the Dow Approach materials is about market timing. Shouldn't you wait for the market's next correction in order to buy the stocks cheaper?

And the answer is: Absolutely, IF you're sure the market's correcting and you know when it's coming. The big glitch in that plan, of course, is that none of us knows if, when, or by how much the market will correct. And to compound the uncertainty, who is to say that the Dow Approach stocks will correct along with the market? Remember 1973-1974, when the market got clobbered and the Foolish Four gained more than 30%?

There are no guarantees in stock investing. But what you can use are the probabilities. And those odds point to a stock market which will be higher five years from now, and five years after that, higher still. With that kind of decades-long trend in place, it's Foolish to take advantage of it by staying fully invested and riding out the rough patches. The other side of that coin is that you won't miss the big jumps by sitting on the sidelines trying to time the perfect entry point.

So our standard answer is, forget the market, forget short-term predictions, forget about timing. When you're ready to start investing for a very long time, just do it (to steal Nike's phrase on a day when that company is celebrating). We don't trot out that response just because it's easy (although it is easy to say "just do it"), but we say it because we believe ignoring market timing will beat it in the long run for the vast majority of investors.

Fool on!

Transmitted: 7/9/96

      THE FOOLISH FOUR MODEL (7/9/96)  

          Day    Week   Quarter  Year  History
Fool-4   0.59%   0.06%  -1.17%  11.73%  11.73%
DJIA     0.56%  -0.11%  -1.29%   9.08%   9.08%
S&P 500  0.34%  -0.44%  -2.39%   6.27%   6.27%
NASDAQ   0.42%  -0.41%  -2.65%   9.64%   9.64%


Bought   #   Stock     In At   Now   Change

1/2/96  380  Chevron   52.38  59.50  13.60%
1/2/96  142  DuPont    69.88  78.63  12.52%
1/2/96  148  E. Kodak  67.00  73.88  10.26%
1/2/96  149  3M        66.38  67.63   1.88%

Bought   #   Stock         Cost       Value      Change

1/2/96  380  Chevron    $19,902.50  $22,610.00  $2,707.50      
1/2/96  142  DuPont      $9,922.25  $11,164.75  $1,242.50      
1/2/96  148  E. Kodak    $9,916.00  $10,933.50  $1,017.50      
1/2/96  149  3M          $9,889.88  $10,076.13    $186.25     

      CASH      $1,082.61        
      TOTAL    $55,866.99         



Transmitted: 7/9/96

      
      

      
      

        

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