I’ve posted Entry #50 to my weekly Beyond Buy-and-Hold column at the Out of Your Rut site. It’s called Buy-and-Hold Is Either the Best Strategy of All Time or the Worst.
Juicy Excerpt: It’s not possible to reach a compromise on points re which both camps are in agreement. Thus, we need to turn to points re which the Buy-and-Holders and the Valuation-Informed Indexers are in disagreement to have any hope of developing a middle-ground position. Unfortunately, there’s only one point of disagreement. And the point of disagreement is a light-switch sort of point; it’s a yes or no matter and it is hard to see how any compromise middle-ground position could be developed.
The one point that divides the two camps is that Valuation-Informed Indexers say that valuations matter and Buy-and-Holders say that they do not. The historical data shows that, if valuations matter, they matter a lot. The valuations factor is roughly 70 percent of the game, according to the data. Those who understand valuations nearly always do well. Those who do not understand valuations nearly always do poorly.