Let’s start this post out with a caveat: If you ever come across a financial advisor who insists they’ve found the secret to timing the market — RUN! In all seriousness, no one has – nor will – discovered the secret sauce to capitalizing on all of the positive movement in the market while also eliminating all risk. They won’t find it because risk is the very essence of what provides you with potential return.

That said, there is one – very imperfect, but useful – philosophy we adhere to at Insight Wealth Group. It was best laid out by the great Warren Buffet when he said:

“You want to be greedy when others are fearful. You want to be fearful when others are greedy. It’s that simple.”

What Mr. Buffet has been able to do for the last six6 decades is not actually that simple, b. But the philosophy holds a lot of truth. In the end, a large part of successful investing is psychological. The cycle of fear and greed – no matter how much you resist it – has a very strong pull.

There is no greater evidence for this than a study that has been conducted for the last 20 years by Dalbar. The Qualitative Analysis of Investor Behavior (QAIB) looks at the inflows and outflows of investor capital in mutual funds and the results are frightening. Per a recent review of this data by Blackrock, an investment in the S&P 500 Index over the 20-year period ending on December 31, 2015, would have netted a return to investors of 8.19% percent annually. Instead, the average investor during that time only received a return of 2.11 %percent!

Why is that? Is it stock selection? Should you just buy and hold the market? No. Instead it seems to be caused by the fear and greed cycle. Simply put, the average investor buys high and sells low.

Think, for example, of the recent 14% percent correction in the equities markets in January and February of 2016. It was an unsettling time. The Federal Reserve was threatening to raise rates four times in 2016. China was struggling. And oil prices were plummeting. The market responded very negatively.

What were you thinking at that time? If, like many investors, you were scared and chose to liquidate some portion of your equity portfolios, you missed out on a strong year of overall market returns.

There’s absolutely no magic formula to solving for perfect returns in the market. Even the best strategies struggle from time to time. But if you’re able to reject the group think of the markets, you might just find a happier result.