History has good news about the future of the market, as the stock market continues to reach new heights. While some investors may be feeling optimistic about the future, others may be hesitant to invest at this time. However, looking back at history can provide some valuable insights for those looking to make the most of their money.
Stock prices have surged significantly over the past 18 months, with the S&P 500 up by 45% and the Nasdaq up by 58%. While investing now may mean paying higher prices than in the past, history shows that there is never necessarily a bad time to buy as long as you keep a long-term outlook.
For example, investing in an S&P 500 index fund in 2011, well into a bull market following the Great Recession, would have still resulted in total returns of over 313% by today. Waiting a few years to invest would have resulted in lower returns, showing the importance of investing sooner rather than later.
The key to maximizing earnings is to keep a long-term outlook and choose strong stocks from companies with healthy underlying business fundamentals. By building a robust portfolio of strong stocks, investors can weather market downturns and see positive returns over time.
Investing can be daunting, but by starting early and investing in the right places, investors can protect their money while maximizing their long-term earnings potential. So, while the future of the market may be uncertain, history shows that staying invested for the long haul is the most profitable strategy.
