If there's a financial cost for the additional bear market protection of market timing, it's difficult to quantify it. In the present study, timing was clearly a benefit, not a cost, as you can see in Table 1 . In the end, both portfolios did very well. For many investors, timing is an emotional drain. It requires watching the markets every business day and moving money in and out, often just when it seems like exactly the wrong thing to do.
Timing adds paperwork and, in taxable accounts, is less tax efficient.
Any investment strategy works only if you follow it. That's obvious, but important, because any time you embark on a strategy, you face the risk that you will become so uncomfortable with short-term results that you'll bail out. And usually when that happens, you're bailing out at the wrong time, when you've lost a significant amount of money. There's no way to know for sure in advance just when any investor will reach the breaking point. But let's look at some details in these two portfolios to see what they required an investor to put up with in order to stay in the game.