Journey into the Art of Long-Term Investing


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3 minutes

Being a successful long-term investor is not just about numbers and spreadsheets; it’s a journey into mastering your mindset. Akin to a chiseled sculptor with a slab of marble, you must hone your instincts and impulses, fighting against a genetic predisposition towards short-term gains that may often lead you astray. Understanding this potential flaw offers you an invaluable advantage, the cornerstone of a skyscraper called success.

winding road photography

Think back to when you last spotted an investing headline that screamed, “Got $1000? Make these 5 Moves NOW” or “This is why you should be WORRIED”. How did it stir your psyche? You might have simply scrolled past, but these silent sirens, constantly clamoring for your attention, have one key aim – to nudge you into action, make you doubt your strategy, and play on your fears.

But let’s face the truth: even the most adept investors aren’t immune to occasional stumbles. You’ll likely make a few bad buys and feel a pinch of discomfort. But fret not – these are but stepping stones in your journey. Accepting these inevitabilities is the first step towards focusing on what truly matters. Your quest to successful long-term investing entails training your mind like an Olympian, crafting habits that act as a sieve, filtering out the noise and extracting valuable lessons from every misstep.

How about this paradigm shift? Next time you brood over a trading blunder, balance it out by toasting to a fruitful trade. It not only highlights the positives but also reminds you of the valuable lessons woven into each success. We rarely pause to celebrate our victories. Let’s change that.

Searching for the Golden Hour

Many investors are laser-focused on pinpointing the absolute ideal price to hop onto a company’s stock. But remember, as a long-term investor, you’re in this for the marathon, not the sprint. The difference between buying a stock at $70 versus $72 may seem significant today, but fast forward 10 or 15 years, and it likely won’t even be a blip on your radar.

Ever experienced the gut-punch of watching your newly purchased shares tumble by 5% the very next day? It’s easy to start doubting your research, wondering if you overlooked some crucial detail. But before you rush to sell off your shares, hold your horses! Pause, reevaluate if there have been any significant changes in the business. Most often, you won’t find any rationale for the drop. Be patient. Allow your picks to simmer and mature. We recommend allowing at least a year for feedback.

Here’s the crux of the matter: The ‘what’ matters more than the ‘when’. Spend your time wisely by focusing on finding robust companies, regularly revisiting those you’re already invested in. Dive deep into their operations – watch interviews with their executive teams, peruse SEC filings, explore their Github pages, and even experience their actual products. That’s the real essence of long-term investing.

Sailing Smoothly: Avoid the Choppy Waters

Successful investing shouldn’t feel like navigating through a storm. We strongly believe that avoiding unnecessary stress forms a significant part of your investment journey. Whether it’s obsessing over price optimization or compulsively checking your brokerage account multiple times a day, it’s crucial to identify and eliminate these stress-inducing behaviors.

Doing so can transform you into a more efficient investor, empowering you to make well-informed decisions, react appropriately to relevant news, and steer clear of knee-jerk reactions. Moreover, this tranquil approach extends beyond the realm of investing, influencing your overall life experience.

Knowing Your Partners in Profit

As a long-term investor, each company you invest in should be more than just a ticker symbol. It should be a business you believe in, a part of a grander investment thesis. You’re essentially becoming a part-owner, so it’s crucial to keep an eye on how your businesses are performing. We understand this can be a monumental task, depending on the number of companies you’ve invested in.

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6 responses to “Journey into the Art of Long-Term Investing”

  1. Nelly Avatar

    I’ve never invested in stocks in my life. I always stopped myself from doing it because I dislike risk when it comes to money. Even the slightest risk. But lately I’m considering it again.

    1. Andy Reimann - StockFit Avatar

      I think that is a great move. What I keep telling people is to focus on long-term investment and a hands-off approach. Investing some money – only a small portion at the beginning, is a great way to get some experience. It’s not high risk since you aren’t 100% invested. Investing in the S&P 500 provides 9.7% annualized growth statistically. Sure, some years it is down, but on average it more more up, than it moves down. The important bit is that an index like that (ticker SPY) contains a wide variety of large companies. No need to research them all, so hands-off.

      Try to avoid checking the portfolio every day and only invest money that you have. As long as your investment let’s you sleep at night, you’re doing everything right 🙂

  2. Ann Avatar

    Digging your investment advice! A lot of folks are clueless about where to start. Growing up, my fam always stuck to the big, stable companies.

    1. Andy Reimann - StockFit Avatar

      That’s definitely a good approach and foundation for a stable portfolio. Thank you for your support 🙂

  3. { Brandi } Avatar
    { Brandi }

    Sounds like solid advice. Investing is admittedly the thing I know the least about in life. Will be following your articles!

    1. Andy Reimann - StockFit Avatar

      Thank you for your support 🙂
      The nice thing about it is that it doesn’t need to take a lot of time. Everyone can do it and just invest in a broad index like the S&P 500 with 9.7% average return (long-term). In the last 120 years, this strategy has worked for all patient investors, no fine-tuning required 🙂

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MY INVESTMENT PHILOSOPHY

 #1 Buy and hold Stocks for 5+ years
 #2 Have at least 25 Stocks
 #3 Don't overreact on short-term news
 #4 Reinvest into your winners

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