Knowing the potential volatility of the Valentine’s Day holiday, I’ll skip the candy and flowers and head straight to the heart of the matter, for lack of a better metaphor. Everyone can endorse the concept of money, right? More money in your account? More money to comfort your singles in Cancun for the weekend? More cash on hand for that inevitable ice cream / shoe shopping binge triggered by Mr.’s aversion. Who won’t be named?
In this sometimes cold and cruel world, it is good to know that good deeds can sometimes replace the warm and welcoming mantle of human interaction.
We’ve all heard the adage “Buy and hold.” But what does that mean? Should you buy and hold independently? How long is a good time to hold? Do you have to act like a day trader, checking the ticker symbols every five minutes and acting like a wacko with excess caffeine?
If you are interested in participating in the stock market, a good place to start is Jim Gard’s The Small Investor Goes to Market. It’s simple, easy to use, and won’t throw any weird jargon at you. It provides step-by-step information on how to get into the market without hitting the Tylenol, and provides an excellent jumping-off spot for the novice investor.
But what about the tenure issue? Like all good relationships, a stock buy and hold should be allowed to develop. Remember those nerves from the first date, wanting to make a good impression? That’s like your action, moments after you buy it. It may spoil your silverware over dinner (lose a few points in the market), take a while to call you back (poor performance), or even not keep the door open for you (definite degradation). But imagine the big smile on your face when he not only calls, but brings more than two dozen roses. That could make Mr. One Not Mentioned a purchase qualification and a one-way ticket to Luckyville.
Most stock analysts will not advise holding a stock for a particular time frame. Instead, it is important to watch stocks within range of the market. Is it considered a premium or recognizable brand? If so, he is much more likely to have legs. How does the company’s approach make these actions different and more likely to be successful? Are they known as a stingy company or somewhere where people are proud to say they work? Seemingly small things, like a company’s image or consumer perception, can drive the price of a stock and determine its long-term value in your portfolio.
Along those lines, if you are looking for a useful investment tool, try Black Box Investing’s subscription service. Subscribers receive conflict-free research (meaning Black Box has nothing to gain or lose by providing the information) on more than 7,000 shares. They provide technical analysis, using a stock’s performance history to determine whether it is likely to pay you back in the future. I find this service absolutely invaluable in making some of my own stock decisions, and perhaps it can help you too.
Unless you want to renew that “Bitter, Table For One” reservation for next year.
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