We believe the Buy & Hold investment approach is appropriate for retirement savings accounts. In fact, over the time period from 1994 to the present, the Buy & Hold investment approach performed better than the average Irish pension fund tracked here, even assuming annual investment costs of 1% per year, as shown in Table 1 below.
Indeed, not one pension provider performed better than the Buy & Hold approach 100% invested in the S&P 500 Index, and only two providers did better than the Buy & Hold strategy 100% invested in the FTSE All-World Index.
Table 1 – Buy & Hold Performance from Jan 1994 to Dec 2020
(Assumes €500 invested every month and annual costs of 1% for Buy & Hold approach)
| Investment Approach | Value |
|---|---|
| Buy & Hold (S&P 500 Index – 500 Largest U.S. Companies) | €609,000 |
| Buy & Hold (FTSE All-World Index – Over 3,000 Global Companies) | €464,000 |
| Average Irish Pension Fund | €445,000 |