Buy and hold is too blunt a strategy in volatile markets

Knowing when 'enough is enough'

Investors who bought into the Japanese equity index on 29 December 1989, more than 30 years ago, are still trading at a 15.5% loss versus current levels.

This fact is a stark reminder that the success of the popular passive buy-and-hold approach is predicated on the initial price paid.  This, by definition, and depending on who you talk to, requires a degree of skill and a dose of luck. One of the most important lessons for retail investors to draw from the current environment is that their portfolio has many gears, and that the passive buy and hold strategy is not suited to volatile markets. How low can the Bank of England go? Six considerations for negative interest rates Capital preservation, taking profits and proactive risk ...