Buy And Homework

Buy and Homework is a buzzy term created by Jim Cramer. It decribes his theory that an investor should buy, and then spend an hour each week studying each stock in their portfolio, rather than the old "Buy and Hold" method that advised to buy and then, well, just hold the stock.

The "homework" piece includes reading news stories, financial forecasts, etc...basically learning what analysts look at. The main complaint on this theory is that people don't have the time to do this. Cramer counters that, if that's the case, a portfolio manager can take over. The other argument against it is that if a person just holds their stock long enough, it'll come around evenutally...but after the Recession of 2008, we've seen enough businesses collapse to know that not every stock recovers.