Harry Osaka knows that the stock market sometimes goes through rough times and that the stocks of poorly managed companies can lose value. But he has noticed that over the long run, the general direction of stock prices has been upward. He is a patient investor who favours holding several different stocks and letting the market take its course. Which of the following does Harry's approach most closely fit?

Question

Quizplus · Accepted Answer

Harry's approach of holding several different stocks and letting the market take its course is known as a buy-and-hold strategy. This strategy involves buying stocks and holding onto them for an extended period, despite short-term fluctuations in the market. This approach is based on the belief that over the long run, the general direction of stock prices is upward. The other strategies listed (working capital strategy, investing for income strategy, value investing strategy) do not necessarily involve holding onto stocks for an extended period of time.

Harry Osaka Knows That the Stock Market Sometimes Goes Through