We have all heard the investment strategy of "buy-and-hold". Sometimes it is pushed as the only valid investment strategy. But is it? The concept ... buy good stocks or mutual funds, sit back, and "let it ride". Wouldn't it be great if it were that easy?!? Unfortunately, the exaggerated potential of buy-and-hold investing is more myth than reality. We believe the buy-and-hold strategy will work when the market is in a 20 year upswing. However, there are long periods when the market is in a trading zone. During these periods, experienced market timers can vastly outperform the buy-and-hold strategy of investing.

History of the Stock Market

The more you study the history of the stock market, the more you begin to understand the real dangers of buy-and-hold investing. A single bear market can destroy a large portion of your accumulated assets. Unfortunately, mutual fund companies, the popular financial press, and even some professional investment advisors, have convinced the majority of investors to accept the "let it ride" philosophy. Do they need to be reminded that, on average, bear markets come along every four or five years?

Nobel Laureate Paul A. Samuelson states, "The longer you own stocks, the greater risk of a devastating loss". Most investors have forgotten, or were too young to recall, the pain of the last big decline. Bear markets have slashed portfolio values an average of 37%. However, there have been declines of -86%, -54%, and -48% during this century!

In terms of real dollars, had you invested $100,000 in the stock market in January of 1973, your investment would have shrunk to $51,800 in just 21 months - a loss of -48%. Assuming you were able to continue your buy-and-hold strategy, you would have waited another seven and a half years just to break even! Sick over their losses, most buy-and-hold investors eventually give up and bail out. And who can blame them.

Successful investing in the stock market takes more than a single decision to buy a mutual fund or stock. It requires many important adjustments as market conditions change. Optimistic predictions from the so-called experts of Wall Street make interesting commentary, but do little to protect your assets when the stock market falls.

We do not pretend to know the future. But we know that buy-and-hold investing will not preserve your assets in the next market decline. The quality of our service speaks volumes and is gaining popularity across the Internet for government worker of FERS. Our system is designed to help members continually beat the buy-and-hold strategy. At ThriftTrading.com, LLC, we are committed in helping our members profit no matter what the future of the market has in store for us, whether bullish or bearish times.