I recently came across the following statement on a salesmanâs website: Buy and hold is dead. It's over. Game, set, match. Trend followers were the only ones who made money in the greatest market melt down since the Great Depression. Do you know how they did it? What an extreme statement. How very black and white. What is the author referring to? What instruments is he considering? What time periods? Has he actually back tested a buy and hold approach on any asset class or classes? Has he considered the effect of asset allocation? Has he looked at re-balancing? Has he actually compared buy and hold to a trend following approach (on stock markets for instance) over varying time periods? Or is he simply sensationalizing the recent market crash? Letâs concentrate for the time being on un-geared stock investments in exchange traded index tracking funds. For the standard private investor in stock markets, these instruments have to be the investment of choice. They avoid stock specific risk and they are self adjusting â as stocks drop out of the relevant index through poor performance they are replaced by better performing stocks. The question is then whether to adopt a buy and hold approach or whether to apply some sort of timing system. To get a more balanced view, one of the soundest series of articles on trend following and its comparison to buy and hold for stock investments can be found here: http://www.fundadvice.com/articles/market-timing.html My own research indicates that timing models and buy and hold show very similar absolute performance on stock market investments over the time. In terms of CAGR. The benefit of a timing model is lower volatility and a reduction of drawdown. Timing models will have you out of the market during a downturn but will have you back in somewhat late when markets turn back up again. Risk adjusted returns can be higher on timing models but absolute returns will be very similar. Buy and Hold will soar higher and dip lower but over time performance is likely to equate with that of a timing model. Yes, you can devise a market timing or trend following system to potentially outperform buy and hold in absolute terms as well as risk adjusted terms. Concentrating your fire power in markets showing buy signals is one way (rather than splitting your position size into equal proportions matching the overall number of instruments in your total potential portfolio). But the simple assertion that âBuy and Hold is deadâ is misleading at best. Especially when you take into account the adverse tax consequences of a timing method which is always in and out of the market. As opposed to a buy and hold approach which has no tax consequences for anything other than the dividend stream while the investment is held. As ever, the moral to be learnt is to do your own research and not to take too much notice of the assertions of others. Myself included. It is true that a timing model can make for a far smoother ride â the same gain for less pain. But it is not the only approach and it is certainly not the only correct approach. The commentator who made the statement set out above may not have thought this complex matter through with the thoroughness it deserves. From my own research, I do not believe that this is the full or complete story.