The buy-and-hold method has worked in the past, but many investors have learned a painful lesson after the last two recessions: hanging on for dear life can result not only in lost money, but lost time. Is the answer found in hiding from equities? Not necessarily. There are lots of uptrends out there – it’s just a matter of learning to spot them and, most importantly, act on them.
If investors can follow a simple discipline that has a higher probability of success, they’ll be motivated to do it. That’s why we use the 200-day moving average strategy. It’s easy to implement and simple to track. For a more detailed explanation of the strategy and to learn more, take a look at our book: The ETF Trend Following Playbook.
For more information on trend following, visit our trend following category.
Max Chen contributed to this article.