Since 1994, DALBAR's Quantitative Analysis of Investor Behavior (QAIB) has been measuring the effects of investor decisions to buy, sell and switch into and out of mutual funds over both short and long-term time frames. The results consistently show that the average investor earns less – in many cases, much less – than mutual fund performance reports would suggest.
The goal of QAIB is to continue to improve the performance of independent investors on the one hand and of professional financial advisors on the other hand by incorporating the factors that influence behaviors that determines the outcome of investment or savings strategies. QAIB offers guidance on how and where investor behaviors can be improved.
QAIB 2017 examines real investor returns in equity, fixed income and asset allocation funds. The analysis covers the 30 year period ending December 30, 2016, encompassing the crash of 1987, the drop at the turn of the millennium, the crash of 2008 plus recovery periods of 2009, 2010 and 2012. No matter what the state of the mutual fund industry, boom or bust: Investment results are more dependent on investor behavior than on fund performance. Mutual fund investors who hold on to their investments are more successful than those who try to time the market.