Buy and hold, also called position trading, is an investment strategy whereby an investor buys financial assets or non-financial assets such as real estate, to hold them long term, with the goal of realizing price appreciation, despite volatility.
[3] It has been recommended by Warren Buffett, Jack Bogle, Burton Malkiel, John Templeton, Peter Lynch, and Benjamin Graham since, in the long run, there is a high correlation between the stock market and economic growth.
[6] However, Warren Buffett is an example of a buy and hold advocate who has rejected the EMH in his writings, and has built his fortune by investing in companies when they were undervalued.
[7] At the Federal Reserve Bank of St. Louis, YiLi Chien, Senior Economist wrote about return-chasing behavior.
The average equity mutual fund investor tends to buy them with high past returns and sell otherwise.