Buy and Hold Strategy

In the financial world, buy and hold strategy is used when stocks bought by an investor is hold for a long time. This strategy is mostly based on the fact that although stock markets show some volatility, but if you hold stocks for a long time, they will definitely give you a good return on your investment. If investors bail out after a sudden fall in the stock market, they will never witness such good returns. The concept of entering the market during decline and selling your stocks when the market is high does not always work. Small investors should never invest keeping in view such timings and the strategy of buy and hold will be more beneficial to them. The concept of buy and hold is mostly meant for day trading where an individual can make money in a very short term if he sells when the market is on its high and buys when the market is on its lows.

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Edited and Updated 31st May 2014

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