What’s Wrong With Buy-And-Hold? Learning how to beat benchmarks with Lane Clark of TPP.

What’s Wrong With Buy-And-Hold?

For decades, investors have been told the same thing:

“Just buy quality assets… and hold them forever.”

Simple. Easy. Almost comforting.

And in the right environment, buy-and-hold can work.

But here’s the reality:

Buy-and-hold only works when the market regime cooperates.

And markets don’t stay the same forever.

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1️⃣ Markets Move in Regimes, Not Straight Lines

Investors often forget that every era has a different market personality.

Sometimes markets trend smoothly upward.
Sometimes volatility explodes.
Sometimes returns flatten for years.

If you started investing during a long bull market, buy-and-hold feels logical.

But history shows long periods where:

• Markets moved sideways for years
• Real returns were minimal
• Drawdowns tested even experienced investors

Buy-and-hold isn’t a strategy.

It’s an assumption that the future will look like the past.

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2️⃣ Drawdowns Matter More Than Investors Think

Many portfolios don’t fail because of bad long-term averages.

They fail because of what happens in between.

A 30–50% drawdown isn’t just a number on a chart.

It means:

• Years to recover
• Lost compounding time
• Increased emotional stress
• Investors selling at exactly the wrong moment

This is where theory meets reality.

Because most investors SAY they can hold through losses…

Until they actually have to.

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3️⃣ Psychology: The Part Nobody Talks About

Buy-and-hold assumes perfect behaviour.

The reality?

Humans are emotional.

When markets fall:

• Fear takes over
• Headlines amplify panic
• Investors question everything

The irony is brutal:

People are told to hold… but many capitulate near the bottom.

So the real risk isn’t just market risk.

It’s behavioural risk.

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4️⃣ The Problem With Passive Thinking

Passive investing exploded because it’s cheap and simple.

But simplicity comes with trade-offs.

You accept:

• Full market exposure at all times
• Full drawdowns when markets turn
• Zero flexibility when conditions change

In strong bullish regimes this looks genius.

In volatile or uncertain regimes, not so much.

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5️⃣ A Different Way to Think About Investing

At TPP, we believe the real question isn’t:

“Should you hold forever?”

It’s:

“Should your exposure change when conditions change?”

Markets evolve.

Risk changes.

Volatility changes.

So why should portfolios stay static?

Sometimes being patient is the right move.

Sometimes reducing exposure protects capital.

Sometimes going flat is the smartest decision of all.

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6️⃣ The Real Goal: Survive to Compound

Investing isn’t about winning one year.

It’s about compounding intelligently over decades.

That means:

• Managing drawdowns
• Respecting psychology
• Adapting to different regimes

Because you can’t compound if you quit halfway through.

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🧭 Final Thought:

Buy-and-hold isn’t “wrong.”

But believing it works in every environment?

That’s where investors get hurt.

The market doesn’t care about ideology.

It responds to risk, sentiment and conditions.

Smart investors should too.

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👉 Want to See How We Approach It?

If you’d like to understand how TPP strategies adapt to different market environments:

➡️ Book a FREE portfolio consultation and platform tour by clicking here.

We'll show you exactly why we're different, and why TPP might be the platform you've been looking for.

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Because the real edge isn’t just what you buy.

It’s knowing when, and how much, to hold.

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