They do this even though most can’t beat the S&P which does the opposite (incrementally buy high and sell low). The odds of picking a top or bottom is near zero. Investors on average turn over their portfolio about twice a year. The average holding period of a portfolio has fallen from 6 years to 6 months over the past 20 years.

In theory an investor could pick a few great stocks each year and beat the S&P over time because if you are wrong you can only lose 100% but if you are correct the gain is virtually unlimited. This acts like a forever option. The problem is that long term performance resides in only about 4% of all stocks.

You can improve your performance by getting rid of your 10% worst performers and replacing them with stocks that are making a new yearly high. The problem with this approach is performance is inconsistent.

A better approach might be to limit your stocks to top 10 holdings in the S&P. Each month buy the stock that has corrected the most or gone up the least over the past year. Sell this stock if it falls out of the top 10. Sell the best performer if you need cash for a purchase.

I am biased. I think the best approach is to buy the cap weighted ETFs SPY and TQQQ. The Stars buy and hold strategy is the best long term approach I can find.