You Can Beat the Stock Market by Avoiding Its Worst Days. But You Won’t

Recently, a post from a market strategist went viral on the social platform X. Here’s a screenshot of the post in question:

		Lance Roberts' Post on X

Data as of March 15, 2026.

To sum it up, to hear this strategist tell it, you stood to make a lot more by averting the market’s biggest losses than you gave up by being out of the market on the days it notched its biggest gains. The implication is you should try to sidestep the worst days and worry less about participating in the best days.

So, let’s assess that claim.

Fact Check

To start with, is this post factually correct? It is. I reran the analysis and arrived at the same figures that the author did. You would have made more by avoiding the S&P’s 10 worst days than you gave up missing its 10 best days. Here are the 10 worst and best days of that period:

Why would you have made more by avoiding the worst days than you would have lost out on by missing the best days? Though the average loss in the 10 worst days was slightly less than the average gain in the 10 best days, losses have more impact once compounded.

To illustrate, imagine owning a stock that loses 10% today and 4% tomorrow but then gains 5% the next day and 10% the day after that. Your average loss is slightly less (7.0%) than your average gain (7.5%). But you’re not back to even. Rather, you’ve lost around 0.2%.

The post passes the fact check.

Nuance Check

That said, Roberts’ post is misleading in a few ways.

For instance, it expresses performance on a cumulative basis. Given this was a 25-year-plus time frame, even minute annual differences can compound to look like a chasm by the end when expressed that way.

As it turns out, the yearly return difference between missing the worst days and missing the best days was narrow. There was a 2.40% per-year penalty for missing the 10 best days and a 2.66% reward for missing the worst, a 26-basis-point annual difference.

		S&P 500: Performance Excluding the Index's 10 Best and 10 Worst Days (Jan. 1, 1990 –March 13, 2026)

Source: Morningstar Direct, author’s calculations. Data as of March 13, 2026. S&P 500 PR returns do not reflect the reinvestment of dividends. Download CSV.

You could argue that even a small difference can add up to a lot in dollar terms over the long haul, making the social media post valid. But that’s a stretch when you consider that the benefit of avoiding the worst days and the penalty of missing the best days have varied over time.

To illustrate, I calculated the S&P 500’s rolling 10-year returns from Jan. 1, 1929, through Feb. 28, 2026, in two ways: The index return excluding the 10 best days and the return excluding the 10 worst days. I also calculated the net difference between the penalty of missing the best days and the bonus of avoiding the worst days.

		S&P 500: Rolling 10-Year Excess Return From Excluding the 10 Best and 10 Worst Days

Source: Morningstar Direct; author’s calculations. Data as of Feb. 28, 2026. The S&P 500 PR excludes dividend reinvestment; rolling 10-year periods at 12-month steps; return bonus (penalty) derived as difference between the “ex” portfolio’s return and S&P 500’s return. Download CSV.

I found the reward of avoiding the worst days was similar to the penalty of missing the best days (this is the “Net” line). While it’s true there were more periods where the former exceeded the latter, the payoff was largely a function of something few of us can predict—the stock market’s direction. When the S&P’s returns were low, it was more important to avoid the bad days, but far less so in periods when the index’s returns were high.

		S&P 500: Rolling 10-Year Index Returns vs. Net Reward of Avoiding 10 Worst Days

Source: Morningstar Direct, author’s calculations. Data as of Feb. 28, 2026. S&P 500 PR index; excludes reinvestment of dividends; reward of missing worst days vs. penalty of missing best days derived as excess return of index ex 10 worst days less negative excess return of index ex 10 best days. Download CSV.

The post’s assertion fails the nuance check.

Reality Check

To this point, we haven’t talked about the elephant in the room: One’s ability to avoid the market’s worst days. To put that challenge in perspective, let’s go back to the post and the period it covered: Jan. 1, 1990, to March 13, 2026. Here’s a time-lapse of the S&P’s daily returns over that span:

		S&P 500 Daily Returns (Jan. 1 1990–March 13, 2026)

		S&P 500 PR; excludes reinvested dividends

Notice anything? The best and worst days cluster. The median gap between one of the 10 worst days and one of the 10 best days was seven days.

		S&P 500: Distance Between 10 Worst and 10 Best Days (Jan. 1, 1990–March 16, 2026)

Source: Morningstar Direct, author’s calculations. Data as of March 16, 2026. S&P 500 PR; excludes reinvested dividends. Download CSV.

What that means is evading the worst days usually courted a high risk of missing one of the best days, given how close they were in proximity to one another. Moreover, partaking in the best days often entailed enduring the worst days. In other words, the best and worst days were largely joined at the hip, a package deal.

The post flunks the reality check.

Conclusion

As with many bold claims, this one has a kernel of truth to it: Arithmetically, investors would have benefited more from avoiding the market’s worst days than they’d have been hurt by missing its best days over the two-decade-plus period concerned.

But the margin was small, and for such a strategy to work, you essentially needed to be able to predict the market’s direction in advance—no simple feat. In lousy markets, a strategy of trying to avoid the worst days paid off nicely, but less so when stocks earned higher returns.

Theory aside, a strategy of attempting to avoid the market’s worst is practically impossible to pull off given how the market’s best and worst days tend to cluster together. This has thwarted generations of aspiring market-timers, novices, and professionals alike, and is likely to stymie success in the future.

The post doesn’t pass the sniff test.

Switched On

Here are other things I’m writing, reading, watching, or listening to:

• A nice roundup of key trends in the target-date fund market.
• Still more on ERShares Private-Public Crossover ETF XOVR.
  • I discuss lessons learned with my colleague Ivanna Hampton.
  • The manager takes to the airwaves with a “plan” for addressing XOVR’s illiquid stake (but it’s between him and his board).
• Hendrik Bessembinder updates his influential research: “One Hundred Years in the U.S. Stock Markets.”
• Dimson, Marsh, and Staunton: The annual global investment returns yearbook is out.
• Jason Zweig on too much (that is, IPOs) too soon; Robin Wigglesworth weighs in, too.
• Bloomberg looks into special-purpose vehicles and finds trouble.
• The movie _Hoosiers, _because, obviously.
• The Rewatchables podcast takes on Fargo.
• Banksy unmasked.
• “Mannequin” by Wire.

Don’t Be a Stranger

I love hearing from you. Have some feedback? An angle for an article? Email me at jeffrey.ptak@morningstar.com. If you’re so inclined, you can also follow me on X at @syouth1, and I do some odds-and-ends writing on a Substack called Basis Pointing.