I'm sure most people would love to make 10% in a single day trading stocks. But what a lot of people don't realize is that daytraders usually lose money for the first 3-6 months of their newfound career.

Oh sure, there are daytraders who make money but those who do rarely outperform the stock market. I once spoke to a daytrader who spends his time in a New York daytrading office building and he bragged about how he increased his portfolio from $275,000 up to $350,000 since October (it was April when I spoke to him). Although I never said it, my first thought was "Big deal! That's a return of 27%. The Dow has had a higher return than that since its October lows."

You might be thinking that you're not a daytrader even though you do trade often. Even weektraders can be hurt by trading stocks too rapidly. Two professors from the University of California at Davis business school, Brad Barber and Terrance Odean, did a study of 60,000 households who traded stocks from 1991 to 1996. Their study showed that the average household had an annualized rate of return of about 15%. However, they discovered that the 20% of households who traded the most often returned merely a 10% gain. A return of 10% per year is great, but this 5% per year difference can really affect you over the long term if you were one of the households that returned only 10% per year.

I have to insist that the "buy and hold" investment strategy is the way to go, especially if you are a Buck investor. Unlike daytrading, buy and hold investing often involves much less risk and often proves to be more helpful in saving for the long term. Not to mention, it allows you more time to spend doing things you love rather than spending the day in front of a computer buying stocks and selling within a matter of minutes. If you find and research a good company, buy their stock, and hold it for the long term, it's possible to achieve a nice rate of return