What Is Buy and Hold?
An investment strategy of purchasing assets and holding them for the long term regardless of short-term volatility.
The Full Definition
Buy and hold is an investment strategy built on purchasing quality assets and resisting the urge to trade in and out based on short-term price movements, news, or market noise. It's grounded in the reality that markets trend upward over long periods despite frequent short-term volatility, and that the investors who consistently underperform the market are usually the ones who sell during downturns and buy back in after recoveries are already underway. Buy and hold doesn't mean never selling — it means decisions are driven by a long-term plan, not by reacting to every dip or rally.
Real-World Example
An investor who bought an S&P 500 index fund in 2008 and held through the financial crisis, the 2020 crash, and every correction since would have captured the market's full long-term recovery and growth — far more than someone who panic-sold during any of those downturns.