According to Dalbar Quantitative Analysis of Investor Behavior 2013:

“QAIB 2013 examines real investor returns in equity, fixed income and asset allocation funds. The analysis covers the 20-year period ending December 31, 2012, encompassing both the drop at the turn of the millennium, the crash of 2008 plus recovery periods of 2009, 2010 and 2012. This year’s report discusses the advantages of asset allocation and how an asset allocator should be evaluated for effectiveness.”

Over more than 20 years,  Quantitative Analysis of Investor Behavior (QAIB) has found that average investor performance is poor and is primarily due to investor behavior. Investors tend to take too much risk at market peaks and then panic after a large decline.

Instead, if investors want to create asymmetric investment returns, we believe it is necessary to manage risk at peaks and through declines and then capture a part of the upside.

For more information about the study, view: Dalbar Quantitative Analysis of Investor Behavior 2013