The about-face of the 5-yr return

Net loss in five years ended 2012 became a huge gain in the five years ended 2013

[NEW YORK] Take the long view. That's standard advice in investing, and it makes sense. After all, if you've salted money away for a serious purpose like retiring or buying a house or paying for a child's education, you really don't want to focus on how the stock market has done today or on what it might do tomorrow. You need a longer perspective.

But there's a fundamental problem with this otherwise sound guidance: How long is the long view? And what do you do if the basis of your long-term thinking changes radically from year to year?

These aren't just theoretical questions. Because of a quirk in the calendar, such a cognitive shift has happened recently. And it suggests that the long view needs...

BT is now on Telegram!

For daily updates on weekdays and specially selected content for the weekend. Subscribe to