๐Ÿง  Shut Up And Wait

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Morgan Housel — author of The Psychology of Money — has long been one of our favorite writers in finance.

Back in 2017, he sent out one of our favorite tweets of all time:

This tweet reminds us of a (perhaps apocryphal) story from Fidelity.

The broker pored through accounts to see which investors had the best returns from 2003 to 2013.

They noticed something odd about the two highest-performing groups:

  1. The account holder had died
  2. The account holder forgot they had an account

Fidelity’s analysis hammers home an important point: most times, the best thing you can do to improve your investment performance is nothing.

Doing “nothing” might sound like dangerous advice, but history shows it’s a sound investing strategy.

Wars. Recessions. Pandemics. Terrorists attacks. Assassinations. The 20th century was filled with bad events.

Yet history shows that investors who consistently resist the urge to fiddle with their portfolio — even when their emotions are screaming at them to do otherwise — dramatically tilt the odds of success in their favor.

There aren’t many endeavors where that’s true, but investing is one of them.

The next time the headlines look scary, remind yourself of the best-performing Fidelity accounts. It might make it a little bit easier to “do nothing.”

Wishing you investing success,

– Brian Feroldi, Brian Stoffel, & Brian Withers

P.S. Want to learn how Warren Buffett analyzes financial statements? Join us for a free webinar on Thursday, Sept 14th, at 12:00 PM EST.

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More From Us:

๐Ÿ‘จโ€๐ŸŽ“ NEW! We’re launching a brand new course — Advanced Financial Statement Analysis — in October! See the details and join the waitlist here.

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