Debunk the Myth of the Buy and Hold Strategy

You don’t need to trade every day to beat the market. In fact, frequent trades can lower the profitability because the commissions eat away the profits.  Your success increases with fewer trades and the longer holding period.

The trend tells us that the longer you hold an investment, the better performance of your portfolio will produce.  Unfortunately, you can’t just buy any stock and hold it forever.  Quality is key.

One example is find companies that enjoy advantages over the competition.  Examples in this category are:  Verizon, Google, Apple…

Another example is find companies that pay their investors dividends.  Examples in this category are:  AT&T, GE, Coca Cola.

Last but not least, companies that buy back their own stocks consistently such as Apple.

These are the kinds of companies that can make you money over a long period of time.

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