Which investment strategy has delivered the best 10-year returns?
We have put five common investing strategies to the test to see how they stacked up against each other. Perhaps not surprisingly in such momentum-driven markets, performance chasing came out top, with bargain-hunting bringing up the rear.
One of the basic tenets of investment is not to buy an asset just because its price has gone up. And yet, in the last decade, performance chasing has been a much better strategy than buying investments that have seen their prices fall sharply — a blind bargain-hunting approach that appeals to many people, but comes with its own health warnings.
Sources: AJ Bell, FE, Investment Association, Morningstar. Data to 31 December 2024.
We modelled these strategies using fund sectors, and the analysis is…
