The equation for successful fund investing in pooled investment products is in the title of this article. The ‘something’ which has to be done is ‘topping up’ or adding more when the portfolio is down. This is done so that the journey to profitability is faster, and it also gives a boost to returns. If the market doesn’t pick up, in the short term or goes down further, (3-4 years) the top-up can make the advisor look silly. This is just markets teaching us humility. 

The other factor, the ‘nothing’ is the correct holding period. The correct holding period is the long-term which is defined as around 10 years for a diversified pool of equity and around 5 years for high yielding fixed income. The correct holding period is related to ‘nothing’ as nothing needs to be done so that the passage of time can do its thing. It is time which makes compounding your powerful ally.