{"id":76977,"date":"2023-10-26T06:12:39","date_gmt":"2023-10-26T10:12:39","guid":{"rendered":"https:\/\/ifintechworld.com\/investing\/this-winning-strategy-can-make-you-more-money-in-the-stock-market-with-less-risk\/"},"modified":"2023-10-26T06:12:43","modified_gmt":"2023-10-26T10:12:43","slug":"this-winning-strategy-can-make-you-more-money-in-the-stock-market-with-less-risk","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=76977","title":{"rendered":"This winning strategy can make you more money in the stock market with less risk"},"content":{"rendered":"<div id=\"js-article__body\" itemprop=\"articleBody\" data-sbid=\"WP-MKTW-0002644591\" role=\"document\">\n<div data-layout=\"inline\n                \" data-layout-mobile=\"\" class=\"\n          media-object\n          type-InsetPullQuote\n            inline\n    scope-web|mobileapps\n  article__inset\n          article__inset--type-InsetPullQuote\n            article__inset--inline\n  \"><\/p>\n<p>          <!-- eventually when we know what this card will be we can change it and leave this one --><\/p>\n<div class=\"wsj-article-pullquote article__inset__pullquote \">\n<p class=\"pullquote-content article__inset__pullquote__quote\">\n        <span class=\"l-qt article__inset__pullquote__mark--left\">\u201c<\/span> You\u2019ll likely do better over the long term by a lower-risk strategy that you can live with through thick and thin. <span class=\"r-qt article__inset__pullquote__mark--right\">\u201d<\/span>\n      <\/p>\n<\/p><\/div>\n<\/p><\/div>\n<p>The key to performing well over the long term is avoiding big losses. That\u2019s the lesson I draw from the newly completed 2023-2024 edition of my Honor Roll of investment newsletters. The advisory services on this list distinguished themselves by their slow-and-steady performance.<\/p>\n<div class=\"paywall\">\n<p>This Honor Roll includes just those monitored investment newsletters whose model portfolios have produced above-average performance in both up and down markets. To identify which those are, I segregated newsletters\u2019 track records over the past 16 years into what was produced in both bull- and bear markets. Only newsletters with above-median performance in each made the Honor Roll. (A fuller description of how I constructed the Honor Roll is available here.)<\/p>\n<p>Consider two hypothetical portfolios, one that each year is divided equally among the model portfolios of that year\u2019s Honor Roll newsletters, and the second among the model portfolios of non-Honor-Roll newsletters. Since 2006, the first portfolio was 27% less volatile, or risky, than the second.<\/p>\n<p>Nevertheless, this lower-volatile portfolio performed 1.0 annualized percentage points better over the past 17 years. Needless to say, it\u2019s a winning combination to make more money with less risk.<\/p>\n<h2><strong>Average can be better than average<\/strong><\/h2>\n<p>It shouldn\u2019t come as a surprise that lower-risk newsletters do better over time. That\u2019s because of an arithmetic quirk of compounding: To recover from a given percentage loss, it takes a greater percentage gain to get back to breakeven. So it\u2019s possible to come out ahead simply by reducing your losses.<\/p>\n<p>To illustrate, consider the U.S. stock market, which has produced a 7.7% annualized return since 1793 according to a database constructed by Edward McQuarrie, an emeritus professor at California\u2019s Santa Clara University. Imagine a hypothetical investment that each year performed exactly half as well or poorly as stocks. That is, if the stock market produced a 10% return in a given year, this hypothetical asset would have gained 5%. If the market lost 10% in a given year, this hypothetical asset would have lost 5%.<\/p>\n<p>You might think this second asset would have produced an annualized return since 1793 that was exactly half that of the actual stock market. But in fact it did better: Gaining 4.2% annualized, versus the 3.8% annualized it would have produced had it gained half that of the market itself. This extra 0.4 percentage point per year is what you would have earned simply by keeping risk low.<\/p>\n<div data-layout=\"inline\n                \" data-layout-mobile=\"\" class=\"\n          media-object\n          type-InsetPullQuote\n            inline\n    scope-web|mobileapps\n  article__inset\n          article__inset--type-InsetPullQuote\n            article__inset--inline\n  \"><\/p>\n<p>          <!-- eventually when we know what this card will be we can change it and leave this one --><\/p>\n<div class=\"wsj-article-pullquote article__inset__pullquote \">\n<p class=\"pullquote-content article__inset__pullquote__quote\">\n        <span class=\"l-qt article__inset__pullquote__mark--left\">\u201c<\/span>  90% of long-term success is staying invested.  <span class=\"r-qt article__inset__pullquote__mark--right\">\u201d<\/span>\n      <\/p>\n<\/p><\/div>\n<\/p><\/div>\n<p>This is one of the secrets behind Warren Buffett\u2019s phenomenal long-term performance, according to a study that appeared in the <em>Financial Analysts Journal<\/em> in 2018 entitled \u201cBuffett\u2019s Alpha.\u201d The three authors, each from AQR Capital Management and sporting a strong academic pedigree, found that Buffett has beaten the market not because of \u201cluck or magic\u201d but by \u201cleveraging cheap, safe, quality stocks.\u201d In other words, rather than favoring high-risk speculative stocks that could win big but also lose big, Buffett favors highly conservative situations. He then leverages up his super-safe portfolio so that its risk more or less matches that of the market as a whole.<\/p>\n<p>Woody Allen is credited with the infamous quotation that \u201c90% of life is just showing up.\u201d The investment equivalent is that 90% of long-term success is staying in the game \u2014 invested, in other words. While investors are inevitably drawn to the excitement of high-risk strategies, they often throw in the towel when that risk translates into intolerable losses. You\u2019ll likely do better over the long term by a lower-risk strategy that you can live with through thick and thin.<\/p>\n<p><em>Mark Hulbert is a regular contributor to MarketWatch. His Hulbert Ratings tracks investment newsletters that pay a flat fee to be audited. He can be reached at <\/em><em>mark@hulbertratings.com<\/em><\/p>\n<p><strong>More:<\/strong> America\u2019s getting older \u2014 and, actually, that\u2019s good news for the stock market<\/p>\n<p><strong>Plus: <\/strong>How to play the coming January bounce-back for 2023\u2019s stock-market losers<\/p>\n<\/p><\/div>\n<\/div>\n<p>Read the full article <a href=\"https:\/\/www.marketwatch.com\/story\/this-winning-strategy-can-make-you-more-money-in-the-stock-market-with-less-risk-6ce8f646?mod=investing\" target=\"_blank\" rel=\"noopener\">here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>\u201c You\u2019ll likely do better over the long term by a lower-risk strategy that you can live with through thick and thin. \u201d The key to performing well over the long term is avoiding big losses. That\u2019s the lesson I draw from the newly completed 2023-2024 edition of my Honor Roll of investment newsletters. The [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":76978,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"video","meta":{"footnotes":""},"categories":[239],"tags":[83],"class_list":["post-76977","post","type-post","status-publish","format-video","has-post-thumbnail","hentry","category-investing","tag-featured","post_format-post-format-video"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>This winning strategy can make you more money in the stock market with less risk | iFintechWorld<\/title>\n<meta name=\"description\" content=\"\u201c You\u2019ll likely do better over the long term by a lower-risk strategy that you can live with through thick and thin. \u201d The key to performing well over the\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/ifintechworld.com\/?p=76977\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"This winning strategy can make you more money in the stock market with less risk | iFintechWorld\" \/>\n<meta property=\"og:description\" content=\"\u201c You\u2019ll likely do better over the long term by a lower-risk strategy that you can live with through thick and thin. \u201d The key to performing well over the\" \/>\n<meta property=\"og:url\" content=\"https:\/\/ifintechworld.com\/?p=76977\" \/>\n<meta property=\"og:site_name\" content=\"iFintechWorld\" \/>\n<meta property=\"article:published_time\" content=\"2023-10-26T10:12:39+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-10-26T10:12:43+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/10\/1698315161_social.jpeg\" \/>\n\t<meta property=\"og:image:width\" content=\"1279\" \/>\n\t<meta property=\"og:image:height\" content=\"640\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"News Room\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"News Room\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/ifintechworld.com\/?p=76977#article\",\"isPartOf\":{\"@id\":\"https:\/\/ifintechworld.com\/?p=76977\"},\"author\":{\"name\":\"News Room\",\"@id\":\"https:\/\/ifintechworld.com\/#\/schema\/person\/6224724fd4116361255b179dc5c70b61\"},\"headline\":\"This winning strategy can make you more money in the stock market with less risk\",\"datePublished\":\"2023-10-26T10:12:39+00:00\",\"dateModified\":\"2023-10-26T10:12:43+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/ifintechworld.com\/?p=76977\"},\"wordCount\":681,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/ifintechworld.com\/#organization\"},\"keywords\":[\"Featured\"],\"articleSection\":[\"Investing\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/ifintechworld.com\/?p=76977#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/ifintechworld.com\/?p=76977\",\"url\":\"https:\/\/ifintechworld.com\/?p=76977\",\"name\":\"This winning strategy can make you more money in the stock market with less risk | iFintechWorld\",\"isPartOf\":{\"@id\":\"https:\/\/ifintechworld.com\/#website\"},\"datePublished\":\"2023-10-26T10:12:39+00:00\",\"dateModified\":\"2023-10-26T10:12:43+00:00\",\"description\":\"\u201c You\u2019ll likely do better over the long term by a lower-risk strategy that you can live with through thick and thin. \u201d The key to performing well over the\",\"breadcrumb\":{\"@id\":\"https:\/\/ifintechworld.com\/?p=76977#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/ifintechworld.com\/?p=76977\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/ifintechworld.com\/?p=76977#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/ifintechworld.com\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"This winning strategy can make you more money in the stock market with less risk\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/ifintechworld.com\/#website\",\"url\":\"https:\/\/ifintechworld.com\/\",\"name\":\"Repay Down\",\"description\":\"Latest Personal Finance News, Tips and Updates\",\"publisher\":{\"@id\":\"https:\/\/ifintechworld.com\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/ifintechworld.com\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\/\/ifintechworld.com\/#organization\",\"name\":\"Repay Down\",\"url\":\"https:\/\/ifintechworld.com\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/ifintechworld.com\/#\/schema\/logo\/image\/\",\"url\":\"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/rep-logo-dark.png\",\"contentUrl\":\"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/rep-logo-dark.png\",\"width\":558,\"height\":90,\"caption\":\"Repay Down\"},\"image\":{\"@id\":\"https:\/\/ifintechworld.com\/#\/schema\/logo\/image\/\"}},{\"@type\":\"Person\",\"@id\":\"https:\/\/ifintechworld.com\/#\/schema\/person\/6224724fd4116361255b179dc5c70b61\",\"name\":\"News Room\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/ifintechworld.com\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/avatar_user_1_1682606986-96x96.png\",\"contentUrl\":\"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/avatar_user_1_1682606986-96x96.png\",\"caption\":\"News Room\"},\"sameAs\":[\"https:\/\/ifintechworld.com\"],\"url\":\"https:\/\/ifintechworld.com\/?author=1\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"This winning strategy can make you more money in the stock market with less risk | iFintechWorld","description":"\u201c You\u2019ll likely do better over the long term by a lower-risk strategy that you can live with through thick and thin. \u201d The key to performing well over the","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/ifintechworld.com\/?p=76977","og_locale":"en_US","og_type":"article","og_title":"This winning strategy can make you more money in the stock market with less risk | iFintechWorld","og_description":"\u201c You\u2019ll likely do better over the long term by a lower-risk strategy that you can live with through thick and thin. \u201d The key to performing well over the","og_url":"https:\/\/ifintechworld.com\/?p=76977","og_site_name":"iFintechWorld","article_published_time":"2023-10-26T10:12:39+00:00","article_modified_time":"2023-10-26T10:12:43+00:00","og_image":[{"width":1279,"height":640,"url":"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/10\/1698315161_social.jpeg","type":"image\/jpeg"}],"author":"News Room","twitter_card":"summary_large_image","twitter_misc":{"Written by":"News Room","Est. reading time":"3 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/ifintechworld.com\/?p=76977#article","isPartOf":{"@id":"https:\/\/ifintechworld.com\/?p=76977"},"author":{"name":"News Room","@id":"https:\/\/ifintechworld.com\/#\/schema\/person\/6224724fd4116361255b179dc5c70b61"},"headline":"This winning strategy can make you more money in the stock market with less risk","datePublished":"2023-10-26T10:12:39+00:00","dateModified":"2023-10-26T10:12:43+00:00","mainEntityOfPage":{"@id":"https:\/\/ifintechworld.com\/?p=76977"},"wordCount":681,"commentCount":0,"publisher":{"@id":"https:\/\/ifintechworld.com\/#organization"},"keywords":["Featured"],"articleSection":["Investing"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/ifintechworld.com\/?p=76977#respond"]}]},{"@type":"WebPage","@id":"https:\/\/ifintechworld.com\/?p=76977","url":"https:\/\/ifintechworld.com\/?p=76977","name":"This winning strategy can make you more money in the stock market with less risk | iFintechWorld","isPartOf":{"@id":"https:\/\/ifintechworld.com\/#website"},"datePublished":"2023-10-26T10:12:39+00:00","dateModified":"2023-10-26T10:12:43+00:00","description":"\u201c You\u2019ll likely do better over the long term by a lower-risk strategy that you can live with through thick and thin. \u201d The key to performing well over the","breadcrumb":{"@id":"https:\/\/ifintechworld.com\/?p=76977#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/ifintechworld.com\/?p=76977"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/ifintechworld.com\/?p=76977#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/ifintechworld.com\/"},{"@type":"ListItem","position":2,"name":"This winning strategy can make you more money in the stock market with less risk"}]},{"@type":"WebSite","@id":"https:\/\/ifintechworld.com\/#website","url":"https:\/\/ifintechworld.com\/","name":"Repay Down","description":"Latest Personal Finance News, Tips and Updates","publisher":{"@id":"https:\/\/ifintechworld.com\/#organization"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/ifintechworld.com\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/ifintechworld.com\/#organization","name":"Repay Down","url":"https:\/\/ifintechworld.com\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/ifintechworld.com\/#\/schema\/logo\/image\/","url":"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/rep-logo-dark.png","contentUrl":"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/rep-logo-dark.png","width":558,"height":90,"caption":"Repay Down"},"image":{"@id":"https:\/\/ifintechworld.com\/#\/schema\/logo\/image\/"}},{"@type":"Person","@id":"https:\/\/ifintechworld.com\/#\/schema\/person\/6224724fd4116361255b179dc5c70b61","name":"News Room","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/ifintechworld.com\/#\/schema\/person\/image\/","url":"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/avatar_user_1_1682606986-96x96.png","contentUrl":"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/avatar_user_1_1682606986-96x96.png","caption":"News Room"},"sameAs":["https:\/\/ifintechworld.com"],"url":"https:\/\/ifintechworld.com\/?author=1"}]}},"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/posts\/76977","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=76977"}],"version-history":[{"count":1,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/posts\/76977\/revisions"}],"predecessor-version":[{"id":76979,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/posts\/76977\/revisions\/76979"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/media\/76978"}],"wp:attachment":[{"href":"https:\/\/ifintechworld.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=76977"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=76977"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=76977"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}