How Long Should I Hold A Stock?

Good morning!

One of the questions I am often asked by prospective investors is how long they should hold onto a stock, or stocks.

If you plan on investing money in the stock market, you have to be willing to commit capital for a minimum of three to five years.

That means any money you invest today should be considered untouchable for at least three to five years. Preferably five.

If you want to know why, take a look at the last 90 days.

Over the past three months, my personal account has gone down 42%.  It took me years to earn what I’ve given back these last 90 days.

However, that’s the stock market.

And that’s why you have to leave your money alone for a considerable amount of time, and let time do its thing.

Fidelity Investments did a study a few years ago in which they discovered that the performance of actively traded accounts underperformed accounts with little or no activity.  Some of these inactive accounts were held by people that had passed away!

Think about what this means!  The stocks were held for years and years, throughout market fluctuation after market fluctuation.  And these accounts ended up outperforming those in which the accountholders kept on trading.

That is a testament to letting your money work over time!

So to reiterate:

Invest with the intent not to touch the money for three to five years, preferably five.  Buy good companies, leave your holdings alone, and let time take its course!

*  The Stock Market is For Everyone, Eric Milton’s short guide to stock market investing for beginners, is available in e-book and paperback formats.  If you like what you see on this blog, we hope you’ll take a moment to purchase and read the book, let us know what you think via a blog comment or Amazon review, and share this information with others!  Thank you. *

Wealth And Credit!

Yesterday, the Federal Reserve announced that they would be increasing interest rates by a quarter of a point.

“How will higher interest rates affect me?”  If you’re wondering about this, read on:

First off, auto loans, home equity lines on credit, and some other loans will not be impacted by the Fed’s decision.

The biggest change you will likely see is that the interest rate on your credit card will go up by the same amount of the increase.  If you carry a balance from month to month, then this is obviously not a good thing.

What I would do in this situation is contact my credit card company and ask them if they could lower my rate.  Many people are not aware that you can do this, but you most certainly can!

And remember: debt is the enemy of wealth.

You should pay down your balance as soon as possible, and avoid carrying a lot of credit card debt.

Until tomorrow!

*  The Stock Market is For Everyone, Eric Milton’s short guide to stock market investing for beginners, is available in e-book and paperback formats.  If you like what you see on this blog, we hope you’ll take a moment to purchase and read the book, let us know what you think via a blog comment or Amazon review, and share this information with others!  Thank you. *

VIDEO: 10 Stocks To Watch In 2019!

This is a list of 10 stocks I think are worth watching in the new year.  If you’ve never invested before, please check out my short guide, The Stock Market is For Everyone.  Thank you!

*  The Stock Market is For Everyone, Eric Milton’s short guide to stock market investing for beginners, is available in e-book and paperback formats.  If you like what you see on this blog, we hope you’ll take a moment to purchase and read the book, let us know what you think via a blog comment or Amazon review, and share this information with others!  Thank you. *