The Death Of Buy & Hold, Pt. 4


Some say the stock market is just a giant casino minus the showgirls and all-you-can-eat buffets. But there used to be one game on the floor with unbeatable odds: Buy & Hold.

If you simply held the same hand over time, you came up aces every time. That is, until Black October. Now, nearly everyone has crapped out with 99.9% of open-end mutual funds in the red this year.

Kicking yourself for not cashing out long ago? This next tidbit might make you feel a little better.

Be thankful you’re not Sheldon Adelson, billionaire honcho of Las Vegas Sands. He put most of his wealth in his own stock this year and came up snake eyes to the tune of $30 billion. He’s possibly the biggest one-year loss ever for any U.S. investor - in history.

Kenny Rogers probably said it best in The Gambler. “You got to know when to hold 'em…know when to fold 'em…know when to walk away…know when to run.”

According to Guy Adami it’s time to run. “Buy and Hold is dead,” he exclaims. “It made sense when transaction costs were through the roof and when investors didn’t have access to market information. But that’s all changed. It’s something that worked at one time, but not now.”

Read More:

> The Death of Buy & Hold Pt. 3 - Trade For The Duration

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Trader disclosure: On Nov.13, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (BTU), (C), (GS), (INTC), (MSFT), (NUE); Macke Owns (MSFT), (UUP), (WMT), (DIS), (MGM); Finerman's Firm Owns (MSFT), (UNH); Finermans Firm Owns (OIH) Puts; Finerman's Firm Is Short (IJR), (IYR), (IWM), (MDY), (SPY), (USO), (BBT), (VNO), (COF), (USO); Pete Najarian Owns (AXP) Put Spread; Pete Najarian Owns (CROX) Call Spread; Pete Najarian Owns (FXI) Put Spread; Pete Najarian Owns (LVS) Call Spread; Pete Najarian Owns (MU) Calls

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