Diversified Bullish

Musings About Investing (Not Financial Advice)

Apr 20, 2022

Buy and Hold

I received a "C" in my only college finance class. I just wasn't that interested in a subject that mostly flew over my head at age 20.

The class consisted of watching video lectures from a reasonable, jolly Finance professor. I failed to absorb most of the lessons, grasping only enough to not get decimated by the course's mid-term and final exam.

One lesson stood out from my professor, who seemed to know his field... "Buy and Hold". Nothing revolutionary but it was the first time someone had introduced me to this simple philosophy.

Owning and hanging onto a stock usually outperforms other more short-sighted investing or trading schemes. It stuck with me. While I have my share of bad investments, the philosophy holds weight and guided me towards some profitable ideas. I continue to hold my highest conviction securities and hold small positions if I am less sure about the company.

A solid investment held on a 5, 10 or 30 year investment horizon will probably appreciate in value. Historically, this is true for many stocks. However, Graham knew investment returns may be extremely unpredictable in sure times and increasingly volatile with global tensions mounting.