In the past 30 years, the S&P 500 (SNPINDEX: ^GSPC) posted an annualized total return of 10.8%. In a single year, this doesn’t seem like much. But over that three-decade stretch, your starting capital would’ve grown 204-fold.
This makes investing in the stock market look like a no-brainer decision. But if you’re a beginner investor in 2026, it’s important to avoid this costly mistake.
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Every investor knows the buy-low, sell-high strategy. This looks like a smart move. And it plays to human nature, which is to take action to capture the market’s positive days and avoid the losing ones.
However, there’s plenty of research that shows this is a losing proposition. Trading too frequently to time the market harms one’s portfolio, as it’s impossible to be consistently successful at jumping in and out of positions.
Had you only missed the stock market’s 60 best days during the 30-year stretch from 1995 to 2025, your total return during that time would’ve been negative. This clearly depicts how critical it is to simply stay invested through the ups and downs.
The best investors don’t try to run away from volatility. They understand that it’s the price you must pay if you want to build long-term wealth in the stock market. Remember this as you go on your investing journey in 2026.
Should you buy stock in S&P 500 Index right now?
Before you buy stock in S&P 500 Index, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and S&P 500 Index wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation, you’d have $371,519!* Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $1,281,302!*
Now, it’s worth noting Stock Advisor’s total average return is 892% — a market-crushing outperformance compared to 206% for the S&P 500. Don’t miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
*Stock Advisor returns as of July 24, 2026.
Neil Patel has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Are You a New Investor in 2026? Here’s 1 Costly Mistake to Avoid. was originally published by The Motley Fool
