Buy and Hold SP500 Not A Good Idea Afterall....

Exactly right Mokwit....and lots of ¨pseudo management¨....

ie barely veering away from indices as well....

which any moron could do....but was guaranteed never to veer much away from the indices.....so more clients would stick around and pay fees....
 
Quote from libertad:

mynd66....

The Standard & Poor's 500-stock index, adjusted for inflation, is now down about 50% over the past 10 years from Feb. 17, 1999 to Feb. 17, 2009


The article got some pull because not adjusted for inflation, one loses on a nominal basis....and including inflation....one loses 50%...

Vanguard exists solely because many a brave manager has had the guts to try harder than just being passive....whereas the passive act like parasites off of those who make the market what it is....

The Vanguard head is an old fart getting a little too cocky....and justs talks his parasitic book as if he has a better way....

Not withstanding the managers who charged fees for pseudo management....which would be just marginally changing the passive components....

All styles come and go....including buy and hold....

And lawyers are always chasing ambulances....
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Thanks Libertad for the insight. I definitey agree that buy and hold is a lost cause. What was not clear to me was how the past ten years was compared to 1929-39. I was actually reading some material on the great depression and not only was the dow down almost 90% from 29-33 but the economic aftermath was much worse than what is going on now. Why did they compare two different ten year time frames 29-39, 99-09 as the latter had two bubbles and both eras were different in many ways? But the magnitude of the dow's drop in those four years of 29-33 was the worst we've seen in real terms (correct me if I am wrong). Who knows we may be headed there. But it doesn't seem we are even close to that yet as some insist as in that article. For some reason they take 1929-39 and rightfully indicate that the dow was down 50% off its highs, but 1939 was 6 years after the bottom hit. We may be -50% now but at no point in time in the past ten years were we off 90% from the highs as was the case back then. I'm just trying to put this in perspective while learning a bit too.
 
Random.Capital




For those looking at really long term historical real returns, it ain't a pretty picture.

...........................................................................................


Good chart....

Also keep in mind that the composition of the stocks in the indices changed as well....

Also many stocks are not accounted for at all....

In terms of the asset class "stocks"....just think of "all stocks" and the "value of all stocks" that simply vaporized....

If this data were available....This would be very telling....

The chart above would account for the "strongest stocks" that existed that were accounted for "only in the indices at the moment".....

The actual case for "buy and hold" would be much weaker....
 
Quote from Derrick1983:

Thanks, JaiSreeram for the reply. Can any of the ETF be traded with Trend Harmony?
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Derrick1983, you can trade ETF with back tested (both long and short) strategies.
 
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