“I Believe That the Buy-and-Holders Are Great People. I Like Them as Individuals. I Want To Be Friends With Them.”

Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:

If you were confident in your market timing scheme, you wouldn’t keep attacking the buy and holders.  If you were confident in your market timing scheme, you would keep making up death threat accusations.  If you were confident in your market timing scheme, you would keep banning posts at your website.  If you were confident in your market timing scheme, you wouldn’t lie about all the successful outcomes from buy and hold.

I believe that the Buy-and-Holders are great people. I like them as individuals. I want to be friends with them. I don’t agree with them on the market timing/price discipline question. I think that they made a mistake re that one because Shiller’s Nobel-prize-winning research had not yet been published at the time Buy-and-Hold was being developed.

I have no problem with people advocating Buy-and-Hold because I believe that the people advocating it sincerely believe in it and there are obviously many people who want to hear about it. I have a big problem with efforts to suppress the discussion of Valuation-Informed Indexing. The reality is that there are today two schools of academic thought re how stock investing works. I want Valuation-Informed Indexing to grow in popularity. That’s not going to happen unless the people who believe in it feel free to openly share their thoughts at every discussion board and blog.

Stocks are an amazing investment class. Since Buy-and-Hold recommends investing in stocks, it has provided those who follow it a measure of success. But the Bennett/Pfau research shows that a decision to avoid maret timing/price discipline never adds and always subtracts. So I don’t believe that that particular aspect of the Buy-and-Hold experience has ever contributed to an investor’s success.

Valuation-Informed Indexing offers all of the benefits of Buy-and-Hold (since everything except the market timing thing checks out and has been incorporated into Valuation-Informed Indexing concept) without the serious negative of the idea that market timing/price discipline might not always be 100 percent required for every investor. Valuation-Informed Indexing is really just an improved version of BUy-and-Hold, a Buy-and-Hold reformed to include the amazing findings of the last 42 years of peer-reviewed research.

My best wishes.

Rob