The most realistic distinction between the investor and the speculator is found in their attitude toward stock-market movements. The speculator's primary interest lies in anticipating and profiting from market fluctuations. The investor's primary interest lies in acquiring and holding suitable securities at suitable prices. Market movements are important to him in a practical sense, because they alternately create low price levels at which he would be wise to buy and high price levels at which he certainly should refrain from buying and probably would be wise to sell.
With actively managed funds, people have big behavior problems. With funds that have done well, they put their money in, and when it has done bad, they want to take it out.
Disregarding the big swing and trying to jump in and out was fatal to me. Nobody can catch all the fluctuations. In a bull market your game is to buy and hold until you believe that the bull market is near its end. To do this you must study general conditions and not tips or special factors affecting individual stocks.
Our favorite holding period is forever.
Index investing outperforms active management year after year.
Nothing is simpler than owning the stock market and holding it forever, and that's essentially the idea behind the index fund.
I think average investors should not trade a lot. The evidence is overpowering. The more you trade, the less you earn.
I don't try and guess when to get in and out of the market. I have owned stocks consistently since 1942. I owned the - I was buying stocks the day before the election. I was buying the same stocks the day after election. And if Hillary had been elected, it would have been the same thing.
I've made money over the years by buying into good companies, run by good people, at attractive prices. And I don't try and make it out of buying into the market at one point and selling at another point.
My favorite time frame for holding a stock is forever.
