What it shows: long-run stock returns are concentrated in a handful of days. Because those days are unpredictable and cluster with the worst days, an investor who moves in and out is far more likely to miss the best ones than to dodge the crashes — which is why time in the market tends to beat timing the market.
The daily returns are simulated, but calibrated to the S&P 500's long-run statistics (about a 10% annual return and 16% annual volatility, with fat tails and occasional crisis stretches). It illustrates the mechanism — it is not a backtest of a specific historical period, and not a forecast. Everything here is educational, not investment advice.
Set up your run
You invest a lump sum and leave it. The only question: how many of the market's biggest days are you out of the market for? Drag the sliders and watch the damage.
days you were in cash for the market's strongest sessions — the cost of being out
the fantasy: days you perfectly sidestepped the worst sessions (nobody can — see below)
a fresh market re-draws a new simulated price path; the link reopens this exact scenario
Missing the 10 best days cost you 53%
Over 20 years, staying fully invested turned $10,000 into $76,760. Sit out just the 10 best days and you end with $35,757 instead — a 53% smaller result, and your annual return drops from 10.7% to 6.6%. Those few days are unpredictable and bunch together with the worst ones, so an investor who moves in and out is far more likely to miss them than to dodge the crashes.
Your final balance
Fully invested
$76,760
10.7%/yr · did nothing
Missed 10 best days
$35,757
6.6%/yr · tried to time
The gap
$41,003
53% of the upside, gone
Perfect timer
$76,760
dodged 0 worst — the fantasy
The same money, two outcomes
Both start at $10,000. The green line never leaves the market; the red one is identical except it earns 0% on the 10 best days. Each missed day drops the red line a notch — and because returns compound, those notches widen into the gap you see at the end.
Every scenario, side by side
The perfect timer who only ever dodges the worst days wins — but that is a fantasy. The best and worst days happen in the same volatile, frightening stretches (the market's biggest up days are often the rebounds right after its biggest drops). In the real world, stepping out to avoid the crash is how you end up missing the recovery.
Reading this
The takeaway is not “the market only goes up” — it is that returns are concentrated in a few unpredictable days, so time in the market beats timing the market for most investors. If you still want to act on signals, do it with your eyes open: see how moving-average and RSI signals actually behave in the Moving Averages and RSI & MACD guides, and weigh timing against dollar-cost averaging.
Embed this on your site
Free to embed — please keep the short credit line below the widget.
<iframe src="https://www.stocktiming.com/tools/timing-cost/" width="760" height="1700" frameborder="0" loading="lazy" title="Timing Cost Simulator"></iframe> <p style="font:13px/1.4 sans-serif;margin:6px 0 0">Powered by the <a href="https://www.stocktiming.com/tools/timing-cost/">Timing Cost Simulator</a> from <a href="https://www.stocktiming.com/">StockTiming</a></p>
Frequently asked
- What does "missing the best days" mean?
- To time the market you have to be out of it sometimes. The market's strongest single days are few, unpredictable, and often cluster right after sharp falls — so being on the sidelines, even briefly, risks missing them. This tool shows what your final balance looks like if you happen to sit out the handful of best days over a multi-year run.
- Why does missing just a few days matter so much?
- Long-run stock returns are extremely concentrated in a small number of days. Miss the best ten days across a couple of decades and a typical buy-and-hold balance can fall by roughly half. Because those days are unpredictable, an investor who moves in and out is far more likely to miss them than to dodge the worst ones.
- Is this using real historical market data?
- No. The daily returns are simulated, but calibrated to the S&P 500's long-run statistics — about a 10% annual return and 16% annual volatility, with fat tails and occasional crisis stretches so big up and down days behave realistically. It is an illustration of the mechanism, not a backtest of a specific historical period, and not a forecast.
- Can't I just avoid the worst days instead?
- In theory, dodging the worst days helps as much as missing the best days hurts. In practice nobody can: the best and worst days bunch together in the same panicky, high-volatility stretches — many of the market's biggest up days are the rebounds that immediately follow its biggest down days. You cannot reliably keep one without the other, which is the core difficulty of market timing.
- So is market timing impossible?
- Not impossible, but very hard, and the evidence is that most attempts underperform simply staying invested — largely because of this best-days effect plus trading costs and taxes. The point of this tool is not to say "never act"; it is to show, concretely, the size of the bet you are making when you step out of the market.
- Is this investment advice?
- No. StockTiming is educational only. Nothing here is financial advice or a recommendation to buy, sell, or hold anything. Markets carry risk and past performance does not predict future results.