The case against buying and holding stocks for the long term

Billy Odell Tucker-Robinson Founder & Host — Banking With Billy Network • Financial Intelligence • Markets • World News • Independent Analysis
Published: 2026-09-24 • Permanent link

Historically, the stock market has been a volatile beast, with prices fluctuating wildly over the years. However, a recent study by the Securities and Exchange Commission (SEC) revealed that the number of stocks outperforming the index has been shrinking. This trend has been observed since the 1970s, when the SEC first began tracking stock performance. According to the study, only 37% of stocks managed to outperform the S&P 500 index in the past decade, down from 44% in the previous decade. The data suggests that investors are becoming increasingly reliant on active managers to navigate the market.

This trend has significant implications for individual investors, who are often caught off guard by market fluctuations. As more and more investors rely on passive index funds, the need for active managers to be nimble and make quick decisions becomes more pressing. This, in turn, can lead to higher fees and lower returns for investors who are not equipped to handle the volatility of the market. Furthermore, the shrinking number of outperforming stocks may also lead to a decrease in investor confidence, as more and more investors become disillusioned with the performance of their investments.

Industry experts point to the rise of passive investing as a major factor in the shrinking number of outperforming stocks. With the proliferation of index funds and ETFs, investors are increasingly opting for low-cost, diversified portfolios that track the market rather than actively managed funds. While this approach can be a good fit for many investors, it may not be suitable for those who are looking for more aggressive or targeted investment strategies. As the market continues to evolve, investors will need to be mindful of their investment goals and risk tolerance in order to navigate the changing landscape.

As the market continues to evolve, investors will need to be prepared for a range of potential catalysts that could impact stock performance. One key area to watch is the ongoing debate over regulation of short selling, which has been a contentious issue in the financial industry for years. With the SEC considering new rules to curb excessive short selling, investors will need to be aware of the potential implications for stock prices and investment strategies. Additionally, the ongoing recovery from the COVID-19 pandemic is also likely to have a significant impact on the market, with investors watching closely for signs of economic growth and inflation.