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I read the following in the Financial Post...

3057 Views 5 Replies 6 Participants Last post by  Oldroe

I stared at this part of the article:
Unlike most advisors, Robert Cable, Toronto-based head of ScotiaMcLeod's Cable Group, is a strong believer in "seasonal" market timing, also called a "sell in May and go away" strategy. While investors may want to emulate Warren Buffett and buy and hold forever, in practice "nobody does it," he says. He recalls asking 300 advisors at a Florida conference how many of their clients had bought and held the same portfolio a decade or more. The only hand that went up represented a client who was literally in a coma following an accident and whose account could not be traded.

"Anyone who goes into investing with the intent of buying and holding virtually always succumbs to outside pressures to abandon the strategy. My guess is when we have nobody believing in buy-and-hold again, we will again be ready for one big bull market to take off," says Mr. Cable.

I had to think about this and wondered if it could be true. Nobody buys and holds? Really? Perhaps people who use "advisors" don't buy-and-hold, but those who don't use advisors use buy-and-hold? Or would this observation be true regardless of whether or not one had an advisor?

Then I thought of myself. I still have the same stocks that I bought 10 years ago (Fossil and Berkshire Hathaway). Of course, I've added stocks since then (I work, money comes in, I deploy it). I had no intention of selling these stocks, but some stocks have been taken out of my hands due to buyouts (eg Oakley, King World Productions). Is this really so rare to hold for 10 years?

Perhaps it depends on the definition of "having the same portfolio" for 10 years. I don't have the same portfolio because, as I mentioned, cash comes in and the portfolio changes (ie more deployable cash).

PS: This is not to say that I haven't sold. I sold Natuzzi and Consolidated Edision.
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There are many ways to skin a cat. Perhaps the greatest hypocrite of all when it comes to investment advice is the fund industry itself. Their trumpetting of buy and hold has more to do with self-interest than it does with any deep seated belief system in the best ways in which to invest. Just look at the average annual turnover of the typical mutual fund portfolio for proof. :rolleyes:
I have every intention of holding what I have for now. Maybe not for a decade, but thats 10 years away. Of course, I'm only invested in index mutual funds, so I suppose the make up of those funds will change frequently. I intend on holding those for a long time though.

Btw, Rickson, the URL in your signature is broken.
When I see a decent profit I take it and I also try to cut my losses whenever possible, anything else doesn't matter.
I had the same portfolio of mutual funds for 10 years and made a measly 2% compounded return. The only change occurred when two of the funds were combined with anothers. New contributions were put in when markets were down to average down. I was so pissed at my buy and hold return that I got out of the funds in January 2008 and transferred the money out of the company that was advising me. The only decent funds that I had were ones I'd chosen myself. The rest were duds.

I would have been better off in GICs over that period but I fell for the mutual fund mania. Never again. I'm not happy that I've saved diligently every year for retirement for the past 30 years and don't have nearly enough to retire in 2 years as planned.
I did really good with my mutual funds the last was sold 2 weeks ago. Have role most of the money into 5 banks and Power Corp/Financial really have no plans to sell and if opportunity comes will add.

Then I buy things like onex (recently sold) Suncro that I will sell soon. The problem I don't see any buys out there.

I fired my FP 20 years ago never looked back.
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