Three years into a devastating bear market, and it's time for a little reality check.

Unless you have some psychic powers (or are really lucky):

• You will never buy a stock at its low point.

• You will never sell a stock at its high point.

• Stocks can go down after you buy them.

• Stocks might go up after you sell them.

Really? No kidding, you say?

Smirk now, but these were all but forgotten lessons in the greed of the 1990s.

And now, the fear is overshadowing them for many investors.

Forgetting these simple facts led many investors to an emotion-filled, roller-coaster method of investing that can be as devastating as the bear market itself.

Greed, fear powerful

Greed and fear are often called the two most powerful elements in investing.

Greed: We all thought stocks would always go up, forever and forever. So many investors years ago ended up buying stocks carelessly, without regard to what they should be worth.

Fear: Stocks have fallen so far, for so long, since that exuberant bubble burst that many are afraid of buying anything. Prices might keep falling.

Emotional investing rarely helps you make any money. It can make you hang on to a loser stock for sentimental reasons; it can make you miss gains if you're too afraid of losses.

Greed: Investors refused to sell two years ago when the tide turned in the deluded belief that it would recover.

American investors lost trillions on paper.

Fear: Investors now are missing the opportunities of bargain-basement prices because too many are afraid to buy anything.

Real values exists, but the funds are sitting in cash and losing out to inflation instead of being poised for growth.

Take disciplined route

That's why investors should take their emotions out of investing.

Granted, that's easier said than done.

But it's the disciplined approach that eases the emotional stress and sets you up for greater profits over decades of investing.

You'll never buy at the bottom. So don't even try.

Do what's called "dollar-cost averaging." Buy in periodic increments instead. Sometimes you'll get it on the way down, sometimes you'll get it on the way up.

You'll never pick the market's biggest gainer, so spread your money around to several to minimize the risk of buying just one.

Better yet, stick to a well-balanced mutual fund that diversifies itself for you. Fund managers have the time, expertise and emotional distance most individual do-it-yourself investors lack.

Overall, you'll get a nice average price on a fine assortment of companies.

There's still no guarantee of profits. Indeed, little you could have done in the last five years could have staved off some of the bear market bloodshed. But this is a time-proven approach that shouldn't make you greedy - or afraid.

Contact Amy Higgins at 768-8373; e-mail ahiggins@enquirer.com; or 312 Elm St., Cincinnati 45202. She regrets that she cannot reply to all individual questions.