There is an investment strategy that I really believe in, and that is buy and hold. Investopedia.com defines buy and hold as:
A passive investment strategy in which an investor buys stocks and holds them for a long period of time, regardless of fluctuations in the market. An investor who employs a buy-and-hold strategy actively selects stocks, but once in a position, is not concerned with short-term price movements and technical indicators.
Buy what you know, buy what you see and use everyday. I buy gas from BP, so I bought some BP stock. So you know what? Everytime I walk into that store I feel a sense of pride. I am a shareholder in this company what happens here matters to me, I own a little bit of every BP in the world and that is something special. I like controling my own financial destiny. But buy and hold is not for everyone it is what I do and what I enjoy. If you don't feel comfortable investing in stocks then invest in stock mutual funds and let the professional money managers decide on which stocks to invest in.
To put your odds of buy-and-hold success into perspective, consider these statistics, published by the Forum for Investor Advice:
Odds that you’ll win the lottery: 1 in 4,000,000
Odds that you’ll be dealt a royal flush: 1 in 650,000
Odds that Earth will be struck by a meteor during your lifetime: 1 in 9,000
Odds that you’ll be robbed this year: 1 in 500
Odds that the airlines will lose your luggage: 1 in 186
Odds that you’ll be audited by the IRS: 1 in 100
Odds that you’ll get snake eyes when rolling the dice: 1 in 36
Odds that you’ll go to Disney World this year: 1 in 10
Odds that the next bottled water you buy will be nothing more than tap water: 2 in 10
Odds that you’ll eat out today: 5 in 10
Odds that an investment in stocks will make money in any given year: 7 in 10
That’s right, over the past 100 years, the stock market has made money 70% of the time. The fact that it didn’t in 2000, or in 2001, is both uncommon and irrelevant to your long-term planning. Therefore, you should not let this recent performance affect your long-term investment strategy.
A passive investment strategy in which an investor buys stocks and holds them for a long period of time, regardless of fluctuations in the market. An investor who employs a buy-and-hold strategy actively selects stocks, but once in a position, is not concerned with short-term price movements and technical indicators.
Buy what you know, buy what you see and use everyday. I buy gas from BP, so I bought some BP stock. So you know what? Everytime I walk into that store I feel a sense of pride. I am a shareholder in this company what happens here matters to me, I own a little bit of every BP in the world and that is something special. I like controling my own financial destiny. But buy and hold is not for everyone it is what I do and what I enjoy. If you don't feel comfortable investing in stocks then invest in stock mutual funds and let the professional money managers decide on which stocks to invest in.
INVEST!! INVEST!! INVEST!! INVEST!!
-THATS THE FINAL WORD-CPD-
To put your odds of buy-and-hold success into perspective, consider these statistics, published by the Forum for Investor Advice:
Odds that you’ll win the lottery: 1 in 4,000,000
Odds that you’ll be dealt a royal flush: 1 in 650,000
Odds that Earth will be struck by a meteor during your lifetime: 1 in 9,000
Odds that you’ll be robbed this year: 1 in 500
Odds that the airlines will lose your luggage: 1 in 186
Odds that you’ll be audited by the IRS: 1 in 100
Odds that you’ll get snake eyes when rolling the dice: 1 in 36
Odds that you’ll go to Disney World this year: 1 in 10
Odds that the next bottled water you buy will be nothing more than tap water: 2 in 10
Odds that you’ll eat out today: 5 in 10
Odds that an investment in stocks will make money in any given year: 7 in 10
That’s right, over the past 100 years, the stock market has made money 70% of the time. The fact that it didn’t in 2000, or in 2001, is both uncommon and irrelevant to your long-term planning. Therefore, you should not let this recent performance affect your long-term investment strategy.
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