Buy Hold Stocks with a Solid Investment Strategy

Investing in the stock market can be intimidating, but having a solid investment strategy can make all the difference. A buy-hold strategy involves selecting a diverse portfolio of stocks and holding onto them for the long term.

Research shows that a well-diversified portfolio can reduce risk and increase potential returns. By spreading investments across different sectors and industries, you can minimize losses and maximize gains.

It's essential to have a clear understanding of your financial goals and risk tolerance before investing. This will help you determine the right mix of stocks to include in your portfolio.

With a buy-hold strategy, you can take advantage of the power of compounding and let your investments grow over time. By holding onto your stocks for the long term, you can ride out market fluctuations and potentially reap the rewards of a successful investment.

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To buy and hold stocks, you need to have a long-term perspective, as it can take months or even years for a stock's value to appreciate significantly.

Having a solid understanding of the company's financials is crucial before investing in its stocks.

Start by researching the company's history, mission, and products or services offered.

Investors should also consider the company's competitive advantage, market trends, and growth prospects.

Diversifying your portfolio is key to minimizing risk, so don't put all your eggs in one basket.

Aim to allocate your investment across different sectors and asset classes to achieve a balanced portfolio.

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The buy-and-hold approach to investing offers a convenient and relatively passive way to invest in assets and hold them for the long term. It's a strategy that focuses on long-term potential and growth over time.

One key principle of buy-and-hold is that asset prices tend to go up more than they go down, as seen in the historical price data from equity markets. The Vanguard S&P 500 ETF, for example, recorded a 10.55% compound annual return in the 30 years up to 2024.

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By holding investments over prolonged time periods, investors benefit from the compounding effect of returns, which can lead to long-term growth potential. This is a key advantage of the buy-and-hold strategy.

Here are some of the key advantages and disadvantages of the buy-and-hold strategy:

However, there are also some potential drawbacks to consider, including the opportunity cost of tying up a large percentage of your available capital in long-term positions. This can limit your flexibility in responding to changing market conditions or individual investment performance.

The key to a successful buy-and-hold strategy lies in carefully selecting stocks that meet certain criteria for growth and quality. This list of best buy-and-hold stocks is updated every few months.

The criteria used to select these stocks tend to produce stocks that outperform the broader market over the long run. These stocks are meant to be held for the long haul, not traded frequently.

The list is created using StockRover.com data, a tool I use for fundamental analysis. This data helps identify stocks that are likely to exhibit long-term growth.

The Best Buy and Hold Stocks List was updated on August 26, 2025.

Minimising trading frequency is a key principle of buy-and-hold strategies. It reduces frictional costs such as trading commission, allowing investors to spend less time managing their portfolios.

A buy-and-hold approach is relatively user-friendly and frees up time for other matters. This is especially true for those who are just starting out with investing, as it can be overwhelming to constantly monitor and adjust investments.

Minimising trading frequency also allows investors to take advantage of long-term macroeconomic events and market cycles, which can optimise returns. As the article notes, "Time in the market, not timing the market" is a key element of buy and hold.

Investors should conduct thorough initial research to build confidence in their strategy and stay informed through news events and earnings reports. This will help them make informed decisions and avoid frequent trading.

Rebalancing may be necessary due to life events such as approaching retirement or achieving investment targets associated with your “financial independence, retire early” (FIRE) plan.

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The buy-and-hold strategy is a convenient and relatively passive approach to investing, focusing on long-term potential and growth over time.

Investors who adopt this strategy can benefit from the compounding effect of returns, leading to long-term growth potential. This is evident in the Vanguard S&P 500 ETF, which recorded a 10.55% compound annual return in the 30 years up to 2024.

Minimal trading activity is another advantage of the buy-and-hold strategy, reducing transaction costs such as brokerage fees and taxes associated with frequent buying and selling.

The simplicity of the buy-and-hold approach is also a significant benefit, requiring less time and effort compared to active trading strategies.

However, there are also some notable disadvantages to consider. One of the main drawbacks is the opportunity cost associated with tying up a large percentage of your available capital in long-term positions.

This can limit flexibility in responding to changing market conditions or individual investment performance, making it challenging during periods of market volatility or when certain assets underperform.

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Investors may also face difficulties in deciding whether to continue holding underperforming investments or reallocate capital to more promising opportunities, which can lead to missed opportunities for optimizing returns.

Here are the main advantages and disadvantages of the buy-and-hold strategy at a glance:

To select the right stocks for a buy-and-hold strategy, consider using a stock scanner like StockRover.com to filter for North American stocks that meet certain criteria.

A typical buy-and-hold portfolio might be weighted towards blue-chip stocks and bond positions, but there is room to allocate some capital to highly speculative investment ideas such as cryptoassets or the stocks of start-up tech firms.

The list of long-term hold stocks is created by filtering for stocks that exhibit traits such as 5-Year EPS Growth Estimate > 7.9% and Max Drawdown in the last 10 years is less than 60%.

The following criteria help filter out smaller companies or extremely volatile stocks:

ETFs (exchange-traded funds) also offer cost-effective diversification and can be a convenient way to invest in an instrument that tracks the overall performance of the financial markets.

Asset selection is a crucial part of stock selection, and it's essential to choose stocks that meet specific criteria to ensure long-term success. The criteria for finding stocks to buy for a long-term hold include a 5-year EPS growth estimate of over 7.9%, 5-year average yearly increase in sales of over 7.9%, and a 5-year average yearly increase in EPS of over 7.9%.

The list of long-term hold stocks is created by filtering for North American stocks that exhibit these traits, and it's essential to consider holding positions for as long as the stocks meet the above criteria. For example, Enterprise Products Partners (EPD) has a 5-year EPS growth estimate of over 7.9% and a 5-year average yearly increase in sales of over 7.9%.

A key principle of buy-and-hold investing is to focus on long-term potential and growth over time, as opposed to short-term gains. This approach requires patience and discipline, but it can lead to significant returns over the long run.

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To ensure that the selected stocks are acting correctly, additional filters are applied, including a maximum drawdown in the last 10 years of less than 60%, a price of over $5, an average daily volume of over 0.1 million, and annualized 5-year returns vs S&P 500 of over 4.5%. These filters help to identify stocks that are less volatile and more likely to produce long-term returns.

The following stocks meet these criteria and are considered great stocks to buy and hold: Enterprise Products Partners (EPD), and potentially others listed in the article. It's essential to do your own due diligence and research before investing in any stock.

Here is a summary of the key criteria for selecting stocks to buy and hold:

CVS Health is one of the largest companies in the world by revenue, operating a large retail pharmacy chain, a health insurance provider, and a pharmacy benefits manager.

Their stock became overvalued in 2014, but they've since made transformative acquisitions to position themselves as a leading multi-vertical healthcare provider.

CVS has a strong economic moat, with a rating of 4 out of 5, thanks to their vertically-integrated business model.

They've managed to create longer-term relationships with clients through their various business lines, despite having low switching costs between pharmacies.

Their balance sheet strength is moving in the right direction, with a BBB credit rating that's average but improving.

CVS's acquisition of Aetna has helped diversify their business lines, making their balance sheet more robust.

With a rating of 4 out of 5 for their balance sheet, CVS is showing signs of financial stability and growth.

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Most rating systems start with the basics: buy, sell, and hold. A buy is a stock that an analyst thinks you should buy now, a sell is one an analyst thinks you should sell, and a hold is one an analyst thinks is good enough to keep in a portfolio but not worthy of additional investment.

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Analysts use different words or letters to indicate their opinions, such as positive, negative, and neutral. Some firms use intensifiers, like strong buy and weak sell, to add more nuance to their ratings.

Industry regulators have passed rules to help investors understand the reasoning behind the rating. These rules aim to provide clarity and transparency in the rating system.

The Schwab Equity Ratings system considers growth potential, performance quality, investor sentiment, stability, and valuation. It rates securities from A to F, with A-rated stocks being the best candidates for addition to a portfolio.

Here's a breakdown of the Schwab Equity Ratings system:

Investors should consider these ratings when deciding whether to buy, sell, or hold a stock. A-rated stocks are the best candidates for purchase, while F-rated stocks may be worth eliminating from a portfolio.

A buy and hold strategy is a great way to approach investing, especially for those with a long-term perspective. This approach involves holding onto stocks for an extended period, often through bull and bear markets.

The idea is to buy and hold stocks that have a strong growth and quality profile, as these tend to outperform the broader market over the long run. These stocks are often stable and well-established companies with a history of growth.

To determine when to buy, look for stocks with a Price/Earnings (P/E) ratio below 40 and a Forward P/E ratio below 35. This will help ensure you're not overpaying for the stock.

Here are some key metrics to consider when evaluating buy and hold stocks:

By following these guidelines, you can increase your chances of success with a buy and hold strategy.

A buy-and-hold strategy is a long-term approach to investing in the stock market. This strategy involves holding onto stocks for an extended period, often years or even decades, rather than trying to make quick profits through frequent buying and selling.

The idea behind buy-and-hold is to ride out market fluctuations and give your investments time to grow. A key benefit of this strategy is that it allows you to defer capital gains taxes on long-term investments, which can save you money.

To purchase shares of common stock is to take ownership of a company. As a shareholder, you have voting rights and a stake in corporate profits as the company grows. Shareholders vote on critical issues, such as mergers and acquisitions, and elect directors to the board.

A stable portfolio is essential for a buy-and-hold strategy. By holding onto a diverse range of stocks, you can spread risk and make it easier to track and monitor your investments.

Here are some general guidelines for buying long-term hold stocks:

These filters help ensure you're not overpaying for your stocks. Buying below these levels can increase your chances of success with a buy-and-hold strategy.

ICE is an attractive exchange due to its relatively fixed costs and variable revenues that can grow with inflation and population.

Its economic moat is one of the strongest a company can have, with a rating of 5 out of 5. This is because once an exchange develops, it becomes the go-to destination for trading liquidity, making smaller exchanges less relevant.

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Liquidity tends to consolidate towards the biggest exchanges, supported by regulatory guardrails.

ICE has been an aggressive grower and acquirer, but this also means it has taken on significant debt. Its A- credit rating and reasonable net debt to annual free cash flow ratio suggest it's managing its finances well.

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Buy and hold stocks are a popular investment strategy, and for good reason. They offer a long-term approach to investing that can be less stressful than trying to time the market.

Historical data from the Vanguard S&P 500 ETF shows that even during a recession, the S&P 500 can still record a 10.55% compound annual return over 30 years. This is a testament to the power of buy and hold investing.

The key to success with buy and hold stocks is to choose the right companies. According to the article, the companies on the Best Buy and Hold Stocks List have exhibited strong earnings per share (EPS) growth, strong sales growth, and stock price stability.

Here are some key statistics from the Best Buy and Hold Stocks List:

These statistics give you a sense of the potential for long-term growth with these companies. By holding onto them for the long haul, you may be able to ride out market fluctuations and come out on top.

It's worth noting that the article emphasizes that this list is not a portfolio, but rather a list of stocks that meet certain criteria. It's up to you to decide which ones to invest in and when.

Investing in buy and hold stocks requires a solid understanding of the fundamentals. To identify potential long-term hold stocks, look for North American stocks with a 5-Year EPS Growth Estimate > 7.9%. This is a key indicator of a stock's potential for long-term growth.

To filter out smaller companies or extremely volatile stocks, consider the additional criteria outlined above. These include a Max Drawdown in the last 10 years of less than 60%, a Price > $5, and an Average Daily Volume > 0.1 million.

Investors who practice buy and hold investing aim to hold onto their stocks for the long term, focusing on growth over time rather than short-term gains. This approach requires discipline and patience, but can be a effective way to build wealth over the long term.

The phrase "Time in the market, not timing the market" is a key concept in buy-and-hold investing. It reminds us that trying to buy at the bottom and sell at the top is nearly impossible.

As a buy-and-hold investor, you'll be holding onto your assets for the long term, which means you'll be exposed to some price fluctuations. However, this approach can lead to ultra-low turnover rates, often under 5% among passive funds.

The idea is to focus on the long-term potential and growth of your investments, rather than trying to make short-term gains. This approach is reflected in passive management styles, where managers focus on issues across the broad market.

By keeping some capital as cash and investing it in financial instruments, you can take advantage of long-term macroeconomic events and market cycles to optimize your returns.

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Buy-and-hold investing focuses on long-term potential and growth over time, rather than short-term gains.

The strategy emphasizes holding onto assets for the long haul, which can help minimize transaction costs and emotional decision-making.

A key principle of buy-and-hold investing is to create a list of long-term hold stocks that meet certain criteria, such as 5-year EPS growth estimates and average yearly increases in sales and EPS.

These stocks are often North American companies with a history of stable growth.

To qualify, a stock must have a 5-year EPS growth estimate of more than 7.9%, and a 5-year average yearly increase in sales and EPS of more than 7.9%.

Additionally, the stock's EPS two years ago must be greater than its EPS five years ago, and its EPS eight years ago.

Here are the key criteria for long-term hold stocks:

To further filter out smaller companies or extremely volatile stocks, consider additional criteria such as a max drawdown of less than 60% in the last 10 years, a price of more than $5, and an average daily volume of more than 0.1 million.

Diversification is key in buy-and-hold strategies to spread risk across markets.

Diversifying capital across different financial areas helps to mitigate the risk of one position underperforming. This can reduce the overall level of P&L volatility.

Spreading your capital across different asset groups can reduce the overall level of P&L volatility. This is especially important if you’re investing on a multi-year time frame.

Having a diversified portfolio can help you to follow the golden rules of investing. This can help you to hold onto positions and stick with your long-term strategy.

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Taxation is an essential aspect of investing, and it's crucial to consider it from the start. Choosing tax-efficient vehicles can help you avoid sharing your returns with tax authorities.

Tax-efficient vehicles can make a significant difference in your investment returns, especially when capital growth is concerned. Capital gains tax (CGT) is something you should pay special attention to.

Staggering your investment over time can help you avoid heavy investment when asset values are overinflated in the short term. This is where dollar-cost averaging (DCA) comes in handy.

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The DCA strategy complements the buy-and-hold strategy nicely by fostering disciplined investing and reducing reliance on market timing. It can also bring about the potential of decreasing the average cost per share over time.

Combining dollar-cost averaging with buy and hold can assist investors in steadily building wealth over the long term.

Warren Buffett's investment fund, Berkshire Hathaway Inc., achieved impressive average annualised compound returns of 19.8% since its inception in 1965.

The key to Berkshire Hathaway's success lies in the fund managers' ability to select well-managed and undervalued companies.

Buying and holding onto Apple stock from January 2008 to January 2019 would have resulted in a nearly 900% return, with the stock price climbing from $18 to $157 per share.

Investors who stick to a long-term strategy can reap significant rewards, as seen in Berkshire Hathaway's outperformance compared to the S&P 500 Index.

Riding out volatility rather than locking in gains can lead to higher returns, as demonstrated by the Apple stock example.

Investment success is also realized by loyalty, commitment to ownership, and standing pat with a chosen position.

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Buy and hold investing is a straightforward approach that has proven to be effective in building wealth over time.

A buy and hold strategy can help you outperform active management, on average, over longer time horizons and after fees. This is because you can typically defer capital gains taxes and avoid the fees associated with frequent trading.

The key to success with buy and hold investing is to approach it with a disciplined savings rate and proper investment criteria. This will help you ride out short-term fluctuations and focus on long-term growth.

A lot of the work is front-loaded and completed during the planning stage, as ongoing management simply involves patience rather than dedicating time to more research.

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