I have a touch of buy and hold too

I just finished reading a book called “Simple Wealth, Inevitable Wealth,” by Nick Murray, an investing expert who received the 2007 Malcolm S. Forbes Public Awareness Award for Excellence in Advancing Financial Understanding.

That’s a mouthful, but Murray’s book is fairly straightforward in its approach and message, which is basically this: You cannot afford to not be in stocks. If you’re not in stocks and don’t continue to stay in stocks, you most likely won’t have enough money for retirement.

And this: Despite all the turmoil the world has seen, and regardless of whether Democrats or Republicans have been in office, over time, as in 10, 20, 30 years or more, the stock market as a whole has only gone one way — up.

By regularly contributing to a balanced set of mutual funds whether they be up or down at the moment — an approach called dollar cost averaging — one can slowly, but steadily, make his or her way to wealth.

The book was loaned to me by Fred Forbes, a local financial planner who is president of Financial Factors Inc. in Palmetto.

Forbes and I trade e-mails from time to time, and he’s often discouraged, and even concerned, by my approach of trying to catch upside momentum in the market and sitting on the sidelines when the markets are down.

He, like Murray, is a buy-and-hold investor who believes that time and proper diversification are the keys to making your money grow in the stock market.

The thing I think took Forbes a little by surprise is that I agree with him and what Murray had to say in his book.

But I also believe in my way, which is to limit losses and buy stocks only when they're moving upward.

Truth be told, however, I do own a trio of Vanguard index funds rolled over from a previous job. I don't fiddle too much with them and make contributions to them when I can.

So I guess I have a bit of the buy-and-hold in me.

I still remain out of the market at the moment, despite the nice move we had this week. I was tempted a few times, but I want to see what this week brings.

Oil prices fell $16 over the week, which brought some relief to stocks.

But as one analyst on CNBC said Friday morning, that could change with a whisper of trouble in the Middle East or threatening weather conditions.

Of course, reading Murray's book, it would seem that it doesn't matter what happens with oil prices, or the Middle East for that matter. Events will run their course and the stock market as a whole will again begin its steady pace upward.

In fact, given last week's action, with financials for once gaining some upward momentum, it may already have begun its upward march anew. Hope Forbes and Murray won't begrudge me too much though for waiting a bit longer to see.

Brian