redbaron

Fractured Wall Street Fairy Tales #1: Buy and Hold is the Best Strategy

Buy and Hold does not mean holding forever, and most investors who use this investment strategy, use a 3-5 year investment horizon. Then, as Shiv Kapoor has already mentioned, there are dividends, who to many investors turn out to be as significant a portion of total income, as capital gains. Some studies show dividends to actually outpace capital gains, long term, if dividend paying stocks are selected for ones portfolio. One recent recommendation from a highly rated stock trading selection service (VV) had them going short for this week, and buying the contra ETF's, when the market has gone up for 4 straight days. While I realize that no one is always correct with their picks, this particular selection had to hurt. It seems to me that this is the time to adopt a more longer term investment horizon, much like Buffet, and just wait for things to get much better. The news is improving daily, and longer term holding seems appropriate at this time, at least in my mind.