The 10 best days in 20 years came right next to the 10 worst

What we found

Over 20 years of SPY with dividends, $10,000 became $78,000 (10.8% a year). Missing the 10 best days leaves $34,000 (6.3% a year); missing the 10 worst, $183,000; missing both, $80,000 (10.9% a year).

The best and worst days come together: 8 of the 10 best came within a month of a top-10 worst day, and 9 of the 10 came with SPY more than 20% below its high.

The full results

The trap in “don’t miss the best days”

The familiar warning is true as far as it goes: missing the 10 best days in 20 years cut the result by more than half. But the best days arrived in the middle of crashes, most within a month of a worst day, so anyone out of the market for the best days was probably also out for the worst.

Missing both made almost no difference. The honest lesson is not that timing always fails, but that the big days cluster in turmoil, so reacting to a crash means both selling into the falls and missing the rebounds.

How it was measured

• Daily SPY total returns; a missed day earns nothing.

Caveats

• No one can pick the days in advance; the point is that the big up days come in the same storms as the big down days.

Questions

What happens if you miss the best days in the stock market?

Over 20 years of SPY with dividends, $10,000 became $78,000; missing the 10 best days left $34,000.

When do the best days happen?

In crashes. 8 of the 10 best days came within a month of a top-10 worst day, and 9 came with SPY more than 20% below its high. Missing both the best and worst left $80,000.