Harry knows that the stock market sometimes goes through rough times and that the stocks of poorly managed companies can lose value. However, he has noticed that over the long run, the general direction of stock prices has been upward. He is a patient investor who favors owning several different stocks and letting the market take its course. Harry's approach most closely fits the _____ strategy.

Question

Quizplus · Accepted Answer

Harry's approach of owning several stocks and being patient for the market to take its course is known as buy-and-hold strategy. This strategy involves holding onto stocks for a long period of time, regardless of short-term fluctuations, in the hopes that the stock will increase in value over time. Value investing focuses on finding undervalued stocks whereas investing for income strategy focuses on generating regular income from investments. Working capital refers to the amount of money a company has available to finance its day-to-day operations.

Harry Knows That the Stock Market Sometimes Goes Through Rough