If religions are our beliefs of the world, investing strategies are our beliefs of the markets. Let us explore some of these investing religions:

Passive Investing

Passive investors believe that you cannot beat the market. Don’t bother trying. Buy index funds and hold for the long term. Most active investors cannot beat the index, not even the professionals.

Market Timing

Market timers believe that buy and hold is dead and slow. You should always get out prior to a catastrophic crash. Look short term as the markets go up and down like a roller coaster.

Modern Portfolio Theory

Modern Portfolio Theory proponents believe that majority of the investment returns come from asset allocation and not stock picking. There must be ample diversification to reduce risk and having different asset classes like stocks and bonds is necessary for a portfolio. Time in the market is more important than timing the market.