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Co-Wise: Why do you stick to long-term investment?
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HopeAlways joined discussion · Dec 22, 2021 04:05

Approaching Investment with a Long Term Mindset

One of the most important quotes from Warren Buffett on investing is "If you aren't willing to own a stock for ten years, don't even think about owning it for ten minutes". Buffett buys stocks because he wants to own those businesses for the long term and approaches most of his investments with the mindset of owning them forever. It does not take a Warren Buffett to build a stock portfolio of well managed businesses and hold on to them for years. No doubt we may not always be right, but even the best investors are wrong a third of the time, or even more. Nevertheless, it is not difficult for anyone to pursue long term investment and there are little hassles about learning different trading styles or platforms.

Investing is one of the best ways to increase our  finances over the long term and achieve our financial goals, but we should not approach investing with the mindset of getting quick gains.  Perhaps, the most dependable way to build our wealth is is to adopt a long term approach. The stock market indexes $Dow Jones Industrial Average (.DJI.US)$, $Nasdaq Composite Index (.IXIC.US)$, $iShares Core S&P 500 ETF (IVV.US)$ can gain and lose values in unpredictable ways, but the best way to deal with market volatility is patience. A patient  investing approach focuses on buying and selling high quality companies $Alphabet-A (GOOGL.US)$, $Amazon (AMZN.US)$, $Apple (AAPL.US)$, $Bank of America (BAC.US)$, $Johnson & Johnson (JNJ.US)$, $JPMorgan Chase & Co. Holdings (LIST2622.US)$, $Meta Platforms (FB.US)$, $Microsoft (MSFT.US)$ $Netflix (NFLX.US)$, $Nike (NKE.US)$, $NVIDIA (NVDA.US)$, $Tesla (TSLA.US)$ for the long term. This is how long term investors gain exceptional returns without ever the need to spend excessive amounts of time worrying over their stock portfolios. Forgoing the stress of day trading, I believe that long term investing is a suitable route to financial freedom.

Long term investment almost takes emotions out of the equation. Sticking with quality stocks for the long term allows me to focus on the long term growth outlook and opportunities of a business, or the viability of a new business model. By aligning my portfolio for the long term, historically it is proven that it will be easier for me to gain outstanding returns. By allowing my winning stocks to run, there is a high chance that my portfolio will grow in the long haul when I am investing in good quality businesses. Sticking to stocks for the long term also allows me to take advantage of compounding to generate even greater profit potential. By reinvesting back into more shares of the same stock, my investment could even double in fewer years. Last but not least, investing over the long term reduces my investment risk by keeping my portfolio volatility low and removes lost opportunities. Staying invested for the long term reduces my risk of missing out on the huge gains.
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Approaching Investment with a Long Term Mindset
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HopeAlways
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