As the name indicates, the strategy entails buying assets and holding them without actively trading. This approach focuses on long-term growth, allowing investments to appreciate over the years despite market fluctuations. The goal is to build a stable portfolio that thrives over time rather than reacting to short-term changes. Typically, the assets under consideration do not require active and continuous monitoring and validation, so the portfolio grows over time.
How Buy and Hold Works
Buy-and-hold is a passive and long-term investment strategy that is used to set up a stable portfolio over a long period of time. Instead of trading shares based on stock market timing, investors buy stocks and hold onto them despite any market fluctuation. Essentially, “buy and hold” means buying assets and keeping them in your portfolio for a significant duration without frequent selling, relying on the overall market growth over time.
Benefits of Buy and Hold
Here are some of the advantages of using the buy-and-hold strategy with Religare Broking:
- Lower Costs: Holding investments for the long term reduces trading fees and tax liabilities.
- Compounding Growth: Putting your earnings back into your portfolio could lead to high growth potential over the long term.
- Simplicity: This method is simple and takes considerably less effort compared to active trading.
Conclusion
Buy and hold is a proven strategy for investors who are willing to wait patiently for the long term, as it involves steadily building wealth over time. When done with quality assets, you’ll appreciate the steady accumulation of value year after year. If you want a simple and automatic approach to increasing your investments, Religare Broking provides the features needed to get you started, along with informative signals.
