Buy & Hold is Dead, and other fallacies.
- Posted by chicagosean
- on March 11th, 2011
2001: Internet Stocks are crashing: SELL EVERYTHING! GET OUT!
2007: Gasoline Prices are killing the consumer: SAVE YOUR MONEY! RETRENCH!
2008: Banks are crashing, mortgages are ruining the earth: SELL EVERYTHING! BUT BUY GOLD!
2010: Greece is Bankrupt: ENTITLEMENTS ARE RUINING ALL WESTERN ECONOMIES! SELL EVERYTHING!
2010: The computers have rigged the markets: I’LL NEVER INVEST AGAIN. HOW MUCH ARE CD’S YIELDING?
2011: Egypt is burning: THIS IS THE END OF CAPITALISM! SELL EVERYTHING!!
2011: There is a day of rage scheduled: WHERE WILL WE GET OUR OIL? PANIC!!!!
Today: Earthquake in Japan! A tsunami is wiping out farm land! Charlie Sheen sues Time Warner: GET ME OUT! I’M SCARED!!!
A funny thing keeps happening on our pending date with disaster. The stock market sells off for a minute, and then magically makes new highs. Buy-and-hold is dead, right?
I’ve been around the markets long enough to know that when everyone is expecting one thing, the other thing seems to happen more often than not. And since everyone started writing off Buy-and-hold sometime around 2003, now seems like as good a time as any to start picking your spots and making smart investments with time horizons in the vicinity of forever.
Nothing is more efficient, simplistic, or minimalist than that.
My Favorite Chart on Earth (The Reformed Broker)
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Sean McLaughlin - Editorial, Curation, & Investor Relations Solutions at StockTwits. Also, former Member of the Chicago Board of Trade who trades his own account in Boulder, Colorado. More »
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