Padley: The problem with "buy and hold"

The Rules of Investing

Livewire Markets

Popular wisdom from the likes of Warren Buffett, Jack Bogle, and Burton Malkiel (author of A Random Walk Down Wall Street) states that it's near-impossible to consistently time the market, so why even try? Just buy and hold for the long term, and collect your dividend cheque every six months. Marcus Padley, Director of Marcus Today, disagrees.

"You can't just sit in the market long-term, which is what everybody wants you to do. You have to time it." 

Marcus points out, that the average annual capital return over the last 75 years, after inflation, taxes, and costs is close to zero. In this week’s episode of The Rules of Investing, he explains his process for getting the timing right, why he thinks the housing market is close to the bottom, and his top candidates to surprise to the upside this reporting season.

Content and links discussed

Time stamps and discussion topics

  • 1:51  - Why he decided to start Marcus Today
  • 5:21 - Some surprising lessons from managing retail clients
  • 7:28 - The case for timing stocks and markets
  • 14:02 - Technical vs fundamental analysis, or technical AND fundamental analysis?
  • 17:21 - Flow analysis: what is it and why should we care?
  • 21:32 – Upcoming earnings season: potential winners and losers
  • 27:07 – Is the housing market close to finding a bottom?
  • 31:48 – Brexit: is the UK investable at the moment? 
  • 37:40 – Marcus answers our three favourite questions

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The Rules of Investing is one of Australia's top investing podcasts. We interview the leading investment minds from Australia and overseas to better understand their processes and philosophy. After launching in October 2017, there have been over...

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