Wednesday, 20 October 2010

Why Buy and Hold Will Always Be a Sound Investing Strategy

It seems like the debate regarding the merits of the "buy-and-hold" investing strategy is alive and well. We always find these discussions amusing, because we believe that it is such a pointless discussion. There is no general argument or case that can be made to support the buy-and-hold strategy or to negate it.

The only true answer to the buy-and-hold argument is it depends on what and/or when you buy-and-hold.

  • If you buy the right company at the right price, then buy-and-hold is a great strategy. 
  • If you buy the wrong company at any price, then the buy-and-hold strategy is a dumb move. 
  • Also, if you buy the right company at the wrong price, then buy-and-hold would once again be a bad move.

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