Ellen Roseman of The Toronto Star reveals in her column today that Derek Foster of buy-dividend-stocks-and-hold-forever fame is not holding up very well in the face of market turmoil:
In early February, he sold everything he owned in his online brokerage account – $472,000 worth of stocks and income trusts – and moved into cash.
“I think we’re in for more pain,” he says when explaining his abrupt about-face.
“My strategy was to buy quality dividend-paying stocks and hold them through thick and thin.”
“I held on all last year, but I’ve been doing lots of research and I don’t think we’re close to the bottom yet.”
I’m just guessing here but I believe Derek is now feverishly working on a new book on timing the markets.
Update: John Heinzl called out Derek Foster on his do-as-I-say-not-as-I-do attitude in The Globe & Mail in a column titled “Buy-and-hold champion sells everything”. He asked some tough questions including this one:
Your first book, Stop Working, preached the buy and hold, dividend-investing philosophy. Selling all your stocks is a repudiation of that. So will you stop selling that book?
A: Absolutely not. Because I think this is a temporary thing. … My total goal in this is to absolutely get back into stocks, but I want to get back into stocks when the yields are up and it’s going to be a wonderful time to buy, when all the excesses have been wrung out of the system.