the fact is most folks bail out between the middle and bottom of the downturns with more outflow towards the bottoms according to morningstar who tracks small investor money in and out of the funds. in fact they said long term small investers have gotten only a fraction of the gains the markets saw.
the flow of money shows they get back in more towards the middle and top after a downturn which is typically higher than they bailed.
one interesting study had you miss the 10 best days but also miss the 10 worst days. the markets did pretty much the same as a buy and hold strategy would have done over the same time frame. not sure of the practicality of such a study but interesting anyway..
heres another interesting study