Hi, my name is Michael Battnick. Is now a good time to buy stocks? If you're an investor, you've probably asked this question at least once, probably multiple times in your life.

Today I'm sitting here with data scientists from Ritholtz wealth management Nick Madually.

Thanks, Mike.

Nick is going to help us answer some of those questions today.

Stick around.

All right, Nick, so you wrote a piece called Why Market Timing can be so appealing.

Very basic question. What do you mean by market timing?

I think market timing is the belief that you can predict the future with regards to your

investment decisions. That's what it is in some form or fashion.

Do you think that people actually believe that or they just or it's sort of like this

illusion or they're like how do you think people really think about that? I think people feel like oh I should get in now before it goes higher and when it's going down you feel like oh I don't want to get in now I should wait until it's lower and so people have feelings about the markets based on valuations based on what's

happening in the news all sorts of things it's not necessary calculus it's it's feelings

yeah yeah so why is this I described it's like an innate feeling to either want to buy the dip or to wait for better

prices like why is that such a fundamental part of an investor's experience?

Because that's what the data shows I mean if, if you, I ran the numbers on this

and 95% of the time you pick a random trading day

and you look at that closed price, 95% of the time,

in the future there will be a lower price. So people have this intuitive feeling like I want to get the best price possible.

The problem is when you try to do that there are times, remember 5% of the time where you see a price and that and the market goes up and it never goes to that price

maybe ever again so that's kind of the fear of that's there not the fear that's the

problem with doing some sort of market timing so to reiterate if you buy stocks let's just say an index fund that's 500 the day whatever yeah if you buy stocks

Historically 95% of the time you would have seen lower returns at some point in the future.

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