A buy and trade quickly strategy can work for the very short term minded. But with a generally rising stock, a buy and hold strategy is the ticket. Only owners can actually build wealth. Traders take short term profits and sometimes have large trading costs, although that's smaller today. Traders pay more in income taxes, even if its done in your IRA due to the ordinary income taxes on the withdrawals. I don't for one minute think that Bill Gates would have been better off trading Microsoft . Traders will eventually make that mistake of outsmarting themselves and re-enter the stock at the wrong price. Always get caught buying too high. Traders get confused as to their skill level and think they've got a system that works like a charm, only to have the market serve their head on a platter.
I'm not against trading, because it's the ultimate strategy for the insecure. Follow along with this one but I'm sure my math is wrong but it's close.
If Christopher Columbus had a $1 bill and traded it every year and made 5% he' have about $28 dollars today. If however, he held that dollar with the same return and was able to COMPOUND that 5% he'd have over $45 billion dollars. So, you can be like Warren Buffet or be like Elmer Fudd.
I used that illustration when I taught investing for the firm.
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