Comments on: Buy&Hold? No, Buy&Sell!

By: Petra Volkova

Petra Volkova — Sat, 28 May 2022 08:37:36 +0000

If such an asset existed, we all would be rich 🙂

https://www.google.com/finance/quote/SPY:NYSEARCA?sa=X&ved=2ahUKEwjQqu_l5YH4AhWEtqQKHVW6DZ8Q3ecFegQICRAg&window=1Y

Indexes can go anytime in any direction with any growth rate. That’s just the market. Its why people trade. No asset has an exponential growth law. Not even bitcoin.

By: ndr

ndr — Sat, 28 May 2022 01:11:47 +0000

“It does not reinvest profits, so the capital grows only linearly, not exponentially.” really?
If you buy and hold an asset that grows 5% per year, that’s exponential growth …

By: Petra Volkova

Petra Volkova — Fri, 27 May 2022 08:59:15 +0000

Certainly. I learned that trading usually involves buying something, then selling it. If it was bought cheaper than sold, the difference is commonly named “profit”. If you can use this “profit” to buy more, this activitiy is commonly referred to as “reinvesting profit”. If you only buy and do not sell, you obviously cannot “reinvest profit”. Hope this helps.

By: Alex

Alex — Fri, 27 May 2022 08:48:52 +0000

Hi Petra, thanks for the article.

I don’t really follow this one:
“It does not reinvest profits”.

If you just plot SPY with the log price scale you will see a straight(ish) line. Meaning it IS exponential.

So basically in Buy and hold, profits are re-invested automatically while the position is held.

This is even regardless of using adjusted (dividends reinvested) or not-adjusted (dividends withdrawn) price history versions.

So I don’t quite follow this one if you could elaborate.

By: Petra Volkova

Petra Volkova — Mon, 12 Jul 2021 10:03:32 +0000

In reply to fred. Wow, nothing escapes you, does it? :)

By: Quantocracy's Daily Wrap for 06/19/2021 | Quantocracy

Quantocracy's Daily Wrap for 06/19/2021 | Quantocracy — Mon, 12 Jul 2021 01:45:59 +0000

[…] Buy&Hold? No, Buy&Sell! [Financial Hacker] […]

By: fred

fred — Sun, 11 Jul 2021 18:06:55 +0000

“Tiny deviations, such as using adjusted instead of unadjusted SPY data, shifting the bars by a few hours, or using a slightly different Stoch variant, produced a quite different backtest. This hints that there’s still room for improvement with this strategy, to say the least.”

No it doesn’t , what it indicates is something that isn’t robust and is likely curve fitted beyond uselessness except for making good grist for readers that don’t know better .

By: q

Sat, 19 Jun 2021 15:09:20 +0000

“With four parameters I can fit an elephant, and with five I can make him wiggle his trunk.” John von Neumann