Buy & Hold

Buy and Hold, Tried and True?

     Despite Wall Street being a two-way street, still most investors simply Buy and Hold stocks for the long-term.  The results below show how $10,000 would have grown to nearly $3,000,000 by buying and holding over the last 55 years up until 2008. It then shows a drop of nearly $1,000,000 in just the one year of 2008!  Fortunately, that $1,000,000 was made back up in the next three years.  This result is a 10.60% compound annual increase since 12/31/1953.  This is the benchmark against which the results of timing the market should be compared.  You will see that our interpretation of the 'original' Dow Theory, the Dow Theory for the 21st Century, the Schannep Timing Indicator, and finally, the Composite Timing Indicator, all have beaten the 'Buy and Hold' benchmark handily!

Year EndBuy & Hold $10,000 Becomes:Dow Jones Level
1953$10,000 280.90
1954$15,063 404.39
1955$18,932 488.40
1956$20,218 499.47
1957$18,473 435.69
1958$25,755 583.65
1959$30,877 679.36
1960$28,944 615.89
1961$35,377 731.14
1962$32,714 652.10
1963$39,493 762.95
1964$46,693 874.13
1965$53,446 969.26
1966$44,852 785.69
1967$53,435 905.11
1968$57,540 943.75
1969$50,681 800.36
1970$55,358 838.92
1971$60,789 890.20
1972$71,849 1,020.02
1973$62,174 850.86
1974$47,328 616.24
1975$68,439 852.41
1976$83,704 1,004.65
1977$72,686 831.17
1978$74,253 805.01
1979$81,728 838.74
1980$99,286 963.99
1981$95,417 875.00
1982$121,308 1,046.54
1983$152,483 1,258.64
1984$153,642 1,211.57
1985$204,640 1,546.67
1986$259,679 1,895.95
1987$273,638 1,938.83
1988$316,924 2,168.57
1989$416,325 2,753.20
1990$414,131 2,633.66
1991$513,962 3,168.83
1992$551,051 3,301.11
1993$644,305 3,754.09
1994$675,239 3,834.44
1995$922,357 5,117.12
1996$1,186,548 6,448.27
1997$1,479,576 7,908.25
1998$1,746,364 9,181.43
1999$2,220,255 11,497.12
2000$2,114,410 10,786.85
2001$1,999,885 10,021.50
2002$1,698,748 8,341.63
2003$2,174,822 10,453.92
2004$2,288,793 10,783.01
2005$2,328,304 10,717.50
2006$2,766,340 12,463.15
2007$3,006,967 13,264.82
2008$2,044,542 8,776.39
2009$2,512,373 10,428.05
2010$2,865,613 11,577.51
2011$3,105,772 12,217.56
2012$3,423,745 13,104.14
2013$4,437,61616,576.66
2014$4,881,18017,823.07
2015$4,890,82017,425.03
2016$5,698,75219,762.60

Buy & Hold results from 1953-1997 were calculated by Hulbert Financial Digest using the Dow Jones Industrial Average with dividends reinvested yearly.  Those results are virtually identical to the results shown here which have been calculated with dividends invested quarterly on the average account value for the period.  My thanks to Tom Halgren, a subscriber with a computer capability that escapes me, for calculating these results. He and I believe this/his calculation is as true and correct as is possible to construct.



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