Buy and hold, also called position trading, is an investment strategy whereby an investor buys financial assets or non-financial assets such as real estate to hold them for the long term, with the goal of achieving price appreciation despite volatility
This approach implies confidence that the value of investments will increase in the future. Investors should not be influenced by recency bias and emotions and should understand their tendency toward risk aversion. Investors should purchase financial instruments that they expect to increase in value over the long term. Buy and hold investors do not sell when the value declines. They do not engage in market timing (i.e., selling a security with the intention of buying it back at a lower price) and do not believe in calendar effects such as selling in May.
Buy and hold is an example of passive management It has been recommended by Warren Buffett Jack Bogle, Burton Malkiel, John Templeton, Peter Lynch, and Benjamin Graham, because in the long run, there is a significant correlation between the stock market and economic growth.