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Sometimes investors can be their own worst enemies. A 2016 study by Blackrock found that stocks averaged an 8.19% annualized return between 1996 and 2015, but the average investor's portfolio only eked out a 2.11% gain. The enormous gap between those figures was caused by investors attempting to time the market.

However, just because the average investors does quite poorly over the long-term doesn't mean that you have to as well. More often than not generating strong returns is just a matter of developing the right investing habits.

Knowing that, we asked a team of Fools to share a habit that the smartest investors use to generate superior results over the long-term.

Know what to do when the market declines

Brian Feroldi: Keeping your head on straight is easy when the market is going up, but all too often "long-term" investors turn into short-term traders when the market heads in reverse. That's a formula for disaster, which is why the smartest investors I know develop a system that helps them keep their cool during times of distress.

One of the simplest tactics you can put use to stay ahead of the curve is dollar-cost averaging. This is when you invest a fixed dollar amount at predetermined intervals regardless of which way the market has trended in the recent past. Thus, when the market is heading up your money will buy fewer shares, but when the market is heading south you wind up buying more.

The great thing about following this strategy is that it will alter your mindset so that you become immune to short-term market movements. When the markets are up you can celebrate the fact that your investments are making money. When the markets decline you can be excited about buying more shares at a discount.

I've been dollar-cost averaging for years and this strategy has really helped me keep my cool during bear markets.

Smart investors don't check their portfolios every day

Matt Frankel: Smart investors don't check their portfolios each day, or if they do, they aren't concerned with the day-to-day performance. A friend recently asked me for a stock recommendation, and I told him that I love Berkshire Hathaway (BRK.A 1.18%) (BRK.B 1.30%) for the long term. Well, he took my advice and bought some shares.

The very next day, the entire market took a hit, and Berkshire lost about 2%. My friend called me and said something to the effect of, "Hey! What's going on? You said this was a good investment... should I cut my losses and sell?"

That is why smart investors don't constantly check their portfolios, especially when it comes to long-term stock holdings. It is this kind of reaction to market movements that leads investors to do exactly the opposite of what they should be doing -- buying low and selling high.

When stocks make a big downside move, investors who obsess over day-to-day stock movements panic and sell. When a stock they're watching is soaring and everyone else is making money, they throw their money in after the stock has gotten expensive. As a result, the average investor's long-term returns are less than one-third of what they would have gotten from a simple S&P 500 index fund.

Smart investors buy great companies (like Berkshire) and hold onto their shares for the long haul. They analyze performance on a monthly or annual basis -- not every day.

Don't overcomplicate things

Jason Hall: One of the most important things about success is making it as easy as possible, and investing is no different. The more complex your investing process becomes, the more likely it is to fail, and the less likely you'll be to stick with it.

The obvious example is Warren Buffett, whose investing process may be as simple as anything you'll find, and has proven to be wildly successful. Buffett's process is based on only a few things:

  • Find great companies with strong competitive advantages and solid long-term prospects.
  • Invest in them at reasonable prices.
  • Hold them for as long as possible.

Let me be clear: There's a difference between "simple" and "easy." Investing is hard, and it takes a lot of work to be successful. But adding more complexity to your process, particularly with methods that involve short-term things that are nearly impossible to predict, is only creating more work for yourself, while probably reducing your chances of success.

It won't necessarily make investing easy, but keeping things simple will certainly make it less difficult, and give you more time to focus on the things that will help you make money.