Buy and Hold Index Investing is one of the popular passive investment strategies for long term investment in the market. Its appeal lies in its simplicity to offer long term investment growth while providing for diversification. It is driven by a belief in market efficiency that assumes that it is difficult to continuously outperform the market. If we take a look at the long-term graphs of some of the major stock market indices – such as S&P 500, Swiss Market Index, Nifty 50 – they demonstrate a sustained upward trend over the long term and the Index Investing strategy seems like a plausible strategy in these scenarios. However, let us examine if this strategy for long term investing can be applied to any markets at any given time. Below are the graphs of some of the indices- This is a graph of S&P 500 since 1982 till date (15/07/2023).
