Account Info
Log Out
Log in to access Online Inquiry

Co-Wise: Why do you stick to long-term investment?

198K Views ·496 Posts
To invest long-term is to prioritize a company's value when you invest, so the value of our assets could grow even when the stock price fluctuates. Buffett once said, "the stock market is a device for transferring money from the impatient to the patient." It indicates that long-term investors could earn more when the companies make bigger cakes, a win-win scenario. These investors can also obtain the risk premium that short-term investors might miss. How do you select companies and be patient enough to invest long-term? Share your thoughts and experience with mooers! Find more details by clicking here.
To invest long-term is to prioritize a company's value when you invest, so the value of our assets could grow even when the stock price fluctuates. Buffett once said, "the stock market is a device for transferring money from the impatient to the patient." It indicates that long-term investors could earn more when the companies make bigger cakes, a win-win scenario. These investors can also obtain the risk premium that short-term investors might miss. How do you select companies and be patient enough to invest long-term? Share your thoughts and experience with mooers! Find more details by clicking here.

Mooers' Strategies: 5 Tips for Successful Long-Term Investing

Once more, Co-Wise: moomoo Tutorial Contest Part 8, "Why do you stick to long-term investment?" ended successfully. Thanks for participating in the contest.
@moobooconcluded that a long-term investment requires the most detailed due diligence and fundamental analysis. @Dadacaiacknowledged that it's a strategy that allows you to make big bucks and sleep well at night.
Thinking FaceIs the long-term investing strategy effective?
Of course. We all ...
Mooers' Strategies: 5 Tips for Successful Long-Term Investing
Mooers' Strategies: 5 Tips for Successful Long-Term Investing
Mooers' Strategies: 5 Tips for Successful Long-Term Investing

Approaching Investment with a Long Term Mindset

Cool Guy 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. ...
Approaching Investment with a Long Term Mindset

What does long-term investment bring to you?

Gift$American Airlines(AAL.US)$ Stock Giveaways
Long-term investment rests on social development and technological progress. Investors could be more patient if they are more informed, which is more likely to achieve in the future. Even if the stock price fluctuates, a company's value will return to its intrinsic value as days go by. Except for stock prices, incomes, profits, and cash flows are also part of the valuation of a company.
First, when the mar...
What does long-term investment bring to you?
What does long-term investment bring to you?

My Long Term Investment Plan

Hi all Mooers, I supposed previously I did share about my strategy in doing investment; long term planning is critical to eventually gain profit in these uncertain times. If one just pursues quick luck and fast capital gains, then the tendency to lose money in the long run is greater. One may gain from one stock and lose heavily in others. Thus, I will only invest with the plan to get dividends over capital gains. If the particular stock really outperform incredibly then would I consider to sell for an immediate hefty profit. As such Reits, ETFs and Bank stocks are my primary targets. Here are some personal sharing and key pointers:
1. To identify a good stock. There is no shortcuts prior to doing an investment, meaning to say there is a need to perform your due diligence by reading the financial/Business reports, news to attain knowledge and information of the various companies that we would be keen to invest in. It is also advisable to study their business trends and growth. This would allow us to better understand the health of the company, cash flow status and to catch hold of any business challenges that the company might faced. Only with prudence will we be assured that our hard-earned money put into investment stands a higher chance to be successful. If in doubt, do not invest. Because for long term investment we are counting on the eventual growth of the company to bring the shares up and not through daily spike for gains.
2. Holdimg Power is Everything. Having the Long term investment mindset also takes away the stress and frustration during a recession. Holding power is everything, so only use spare money to buy shares, if not you would be complied to sell it at a "bad" price. As part of my plan, I will never sell a stock that is in RED. It would be good to buy more shares during the dip and increase your portfolio for larger dividend returns. There will come that it will rise passed the buying point where you can consider to sell for capital gains after your experience of the stocks' performance over time.
3. Patience. Never be too eager to put your money in. Can spend several weeks or months to study the perfomance trend of the company before committing. This will also help you identify the best entry point. True that one may miss the boat to buy a rising stock due to hesitation but at least your money is still in your hands. Many a times, we would hope that we didnt get into a deficit and hope for a restart where you can do it all over on paper trading but not with you own money.
Some of the stocks that I have identified that I am investing in are:
$Nikko AM STI ETF(G3B.SG)$
$DBS Group Holdings(D05.SG)$
$CapLand IntCom T(C38U.SG)$
$OCBC Bank(O39.SG)$
$Suntec Reit(T82U.SG)$
$Keppel DC Reit(AJBU.SG)$
$CapLand Ascendas REIT(A17U.SG)$
$Mapletree Ind Tr(ME8U.SG)$
$Mapletree Log Tr(M44U.SG)$
$Mapletree PanAsia Com Tr(N2IU.SG)$
$Sheng Siong(OV8.SG)$
Here are some others that are also from good companies with potential but I would say riskier.
Let's all have our long term strategy in place for a bountiful future!
Merry Christmas and Happy New Year!

Long Term Investment - A Strategy for Growing Returns Without Sleepless Nights

Patience is a Virtue
Throughout the ages, great teachers have extolled the virtue of patience and this has proven to be true in the minefield of stock investments. Arguably the most well-known student of Benjamin Graham (the father of value investing), Warren Buffet gave two valuable pieces of advice:
1) “Price is what you pay. Value is what you get”.
2) “For the investor, a too-high purchase price for the stock of an...
Long Term Investment - A Strategy for Growing Returns Without Sleepless Nights
Long Term Investment - A Strategy for Growing Returns Without Sleepless Nights
Long Term Investment - A Strategy for Growing Returns Without Sleepless Nights

Avoid misunderstandings and seize the core of the transaction!

A good company can continuously use incremental capital to obtain a high rate of return in an extended period. On the contrary, a bad company will require a continuous large amount of capital investment but has a low rate of return. How to judge the subsequent rate of return of the purchasing company?Thinking FaceThinking FaceThinking Face
Buffett said that 2 points are essential:
1. Buy the company that you know
It can predict future cash flow, do the right thing in the ability circle, and avoid major mistakes.
2. Ensure sufficient margin of safety
Good companies that meet the conditions must be bought in heavy positions because few good companies exist.$Berkshire Hathaway-A(BRK.A.US)$ $Berkshire Hathaway-B(BRK.B.US)$ 
The industries and companies that Buffett likes almost certainly still have a competitive advantage in the next 10 or 20 years, and the environment is unlikely to undergo significant changes.$AMC Entertainment(AMC.US)$ 
For example, for a blue-chip such as $Apple(AAPL.US)$ , if you take a stop loss and do a long-term trend in a large cycle, it will not be stopped until now. From the end of 2008 to now, it has been a trend of rising lows. Even the market with four circuit breakers at the beginning of 2020 not stop. This is the so-called large-period broad stop loss and does not hinder long-term investment.
There is also a survivor's in addition to non-stop loss and payback. Sometimes you see a trader using a specific high-risk method and earning wealthy profits in a year, and the profit margin far exceeds Buffett.
SurpriseIs it possible? 
Of course possible;
SmugCan it be replicated? 
It may not be possible;
Bah! RCan it last? 
Of course not;
Otherwise, the top master in the market would not be Buffett.LaughLaughLaugh
Don't be messed up by all sorts of large profit orders and information pushes of various stocks. Under the iceberg, more large loss orders unreleased. If you always maintain fully leveraged transactions and do not protect the profits you have already made, you will soon return to the market in most cases.$NVIDIA(NVDA.US)$ $Lucid Group(LCID.US)$ $NIO Inc(NIO.US)$ 
Trading requires a high degree of self-discipline, persistence, and hard work. It's not that you make money in trading; it's that you have to do these to make money.
Avoid misunderstandings and seize the core of the transaction!
Avoid misunderstandings and seize the core of the transaction!
Avoid misunderstandings and seize the core of the transaction!

Buy something you’d be happy to hold for 10 years

The exact quote by Warren Buffett is
“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years”. Mr Buffett is no doubt the best long term investor in the stock market and he is my inspiration when it comes to long term investment. For me, long term investment means a time frame of more than 5 years.  
Why do I like long term investment?
1.  Buying a stock of a company is owning a part of the company.  When you think like a owner, you focus on the business and not the stock price.  It is therefore critical to think long term.  You do not sell your company when it does not do well in a week, you would try to make it work. It is the same in long term investment.  Once you have selected the company to invest, you stick to the plan unless the fundamentals change.
2.  I like the process of selecting and researching the companies to invest in.  As a long term investor, in order to have a peace of mind when you invest, you need to do your due diligence.  As a start, you need to know the following:
* What does the company do?
* How do they earn their revenue?
* How are their financials?  For eg.  Look at their financial ratios, price to earning, price to sales, free cash flow, debt level.
* Who are the management?  Can they execute the plan and the vision?
* Who are their competitors?
I make a checklist and score the shortlisted companies.  If they make the score, I will start a position in the company.
3.  Long term investment eliminates emotions roller coaster and sleepless night.
In the stock market, there can be a lot of noise.  The stock price goes up and down.  By focusing on the business, I can take away the emotions roller coaster.
That does not means that I just ignore my investment.  I would keep myself up to date on the company development during the quarterly results update.  During the quarterly update, pay attention to the financial results and especially the CEO update. Reading the transcript is important.
4.  Long term investment can bring massive return.Everyone dream to have a 100 bagger.  Only long term investment can bring a 100 bagger.  If we let go of a winner too early, we would not be able to have a 100 bagger.
$Amazon(AMZN.US)$ , $Berkshire Hathaway-A(BRK.A.US)$ , $Apple(AAPL.US)$ 
So does it means that long term investment is a sure win?
Unfortunately no.  All investment carry risk.  There are cases whereby the company did not keep up with the times and get replaced.  For eg. Blockbuster. In those cases, the investment can go to zero no matter how long you hold it. So we need to do risk management.  For me, that is portfolio allocation and dollar cost averaging.
Ultimately, all roads lead to Rome.  Find the investment strategy that you are most comfortable with so that you can strive from it. It can be long term investment, day trade or options trading. There are many experts in the Moomoo community that you can learn from for the different strategies.
@Mcsnacks H Tupack@HopeAlways@Mars Mooo
May the market be with you.
Merry Christmas 🎄!

How using VALUE WHEEL options strategy "forces" me to be discipline in investing while giving me some actions in the game

There is a common saying that the retail investors always buy high, sell low. The reason for that is because they trade based on feelings that is greatly influenced by the movement of the stock prices. This can happen to value investor too.
When we have done all our due diligences and we value a company at say 100 per share. Large movement in the price can sway our conviction. When the price keeps rising to 120, 150, 170, FOMO can start to kick in causing us to buy high so that we won't miss the gains. Then what follows is the stock price plunging back down. Or when the price drop to 80, 60, 40, fear starts to creeps in. So instead of buying low, we give up buying completely. Then the price fly to the moon.
It is understandable why this happens because it is hard to sit on the sideline waiting while everyone seems to be in on the action, flaunting their paper gains. Your backside gets itchy. That is why I use options to execute my long term investment strategy so that I always get a piece of the action while staying disciplined and not break away from my trading plan.
Most people might see it as a WHEEL options strategy but I added an upper and lower limit to it and make it what I called a "VALUE WHEEL" options strategy. Or in another words, do not WHEEL an overvalued company.
So how it works? I will use $UP Fintech(TIGR.US)$ as an example. So when China begins cracking down on Chinese stock, I started to see opportunities in China stock. Thus I began analysing them. I love it when there is a crash, just like the covid crash, because that is when prices usually falls way below the company's fair value after accounting for the risks. Online brokerage stocks like $Futu Holdings Ltd(FUTU.US)$ and Tiger got into my radar. I started building valuation model for the company (assuming China market is completely banned, estimating future growth in customers, sales and margin, etc etc). I came out with a fair value of 5 for Tiger with a exit price of 10 (in the short term) and 20 (in the longer term). with these prices in mind, I can easily use options to execute my plan.
So I will buy when price is 5 in the short term, and the upper limit of my buy price is 7.5 (below 10). Even if the price rocket to 20 or 30 in the short term, I will ignore it and always buy at max 7.5. I will always sell when price hits 10 in the short term, and ignore any rallies. the rule is DO NOT DEVIATE unless there is some fundamental shift in the business.
Instead of buying and selling normally, I will use options to execute the trades. It is very similar to the WHEEL strategy but the difference between this "VALUE WHEEL" and the typical WHEEL is just having this value investing principle of upper and lower limit taking precedence over ROI on capital. Selling options at the set target price could yield very little premium but it doesn't matter as the value investing principle takes precedence over income generation.
So with that in mind, I started selling PUT options with a strike price of 5. This way I can earn premium regardless if the price drop below 5, plus I "locked in" my trade. So in October, I started selling PUT options. The first PUT expired worthless because the price of the stock was >5 but I collected usd18 per contract (I couldn't add the older PUT into this comment not sure why). After that contract expired, I sold more PUT and collected USD107 in total premium in November.
On the day when this contract was going to expire, some FUD was released in the news (Reuters and CNA) causing a panic sell of both Tiger and Futu stock. Futu and Tiger drop about 15%. Tiger dropped to about 4 and I was so happy as I could finally buy the shares Laugh The stock price recovered though after they release a statement saying the news was fake.
Tiger ended the day at 4.95. So I was assigned and I fork out 2,000 to buy 400 shares of Tiger.
So without using a PUT options, I would have placed a LIMIT order for 400 stocks at 5 anyway, so this is just a way for me to earn extra income (even when I don't get to buy the stock) for doing almost essentially the same thing.
So after I gotten the stocks, I started selling covered call options to get more premium, and "forced" myself to sell when the price hit 10. This way I won't be greedy when there is a rally. That is one of the most common complains I see in the comment section where people got greedy and did not take profit. In the end they saw their 600% gain dropped into the negative.
Since I also have a longer term target of 20, I will change the call strike price to 20 when the criteria is met. otherwise, I'm sticking to 10. I'm intending to sell more PUT with a strike of 2.5 too. since 2.5 is below my fair value of 5.
Using this VALUE WHEEL strategy, I can have some "action" by selling PUT and CALL option every month, so that kills boredom of the typical value investing of buy and hold. Plus it forces me to be discipline and give me extra income for being discipline.
Some of you might be wondering what if I'm wrong? Or what if unexpected things happen and the valuation goes haywire? It's either I take a hit or I'll use other tactics to try and recover from the trade. one of such tactics is known as rolling which is explained in this post:
Hope this sharing could help you in your trades LaughLaugh$Grab Holdings(GRAB.US)$$DiDi Global (Delisted)(DIDI.US)$$AT&T(T.US)$$Palantir(PLTR.US)$$Discovery-A(DISCA.US)$$AT&T(T.US)$$Realty Income(O.US)$$Berkshire Hathaway-A(BRK.A.US)$$Berkshire Hathaway-B(BRK.B.US)$



Why do I go with long term investing?

1. More Rational, Less Emotional - you will tend not to be affected by market volatility. This allows you to sleep better at night. Generally, long term investing is less stressful vis-à-vis trading
2. You don’t have to time the market - time in market over timing the market. And staying invested throughout will leverage on compounding interest. A lot of people underestimate the power of it.
3. Save time - when you don’t have to try to time the market, it saves a lot of your time as you don’t need to do research or watch the market movements daily
4. Lesser investment risks - a lot of people also underestimate this portion. Swing / day traders definitely face more risks. But that doesn’t mean their method is wrong/not good - these traders put in lots of time and efforts to manage the risk. Hence kudos to them. Everyone has their own plan and risk appetite, that’s all I can say
5. Be part of the company - by holding stocks over long term means you’re part of the company (in a way). You will grow with the company and join its journey to success (hopefully!)
6. Bonus: Make friends - you can meet like minded people and shout “to the moon” with the fellow long term stock holders :)
$Advanced Micro Devices(AMD.US)$ 
$Rivian Automotive(RIVN.US)$ 
$Meta Platforms(FB.US)$ 
$Futu Holdings Ltd(FUTU.US)$ 
$Grab Holdings(GRAB.US)$ 
$Lucid Group(LCID.US)$ 
$ARK Innovation ETF(ARKK.US)$ 

LT Investment is like Marriage

1. Open both eyes wide before buying - Read, see, observe, study, think. Do your homework (FA, companies leadership, culture, vision, order book, cash flow, etc). Then have a strategy and price-action using TA to determine entry point. Investment timeframe is at least 3 to 5 years.
2. Close one eye after buying - After you purchased the stock, relax and do not waste too much time to monitor or track price fluctuations. If you like, do a yearly or half yearly review.
To me, it is quite similar to marriage. Before marriage, open both eyes wide to choose the appropriate spouse. Do FA - upfront decide on what character & qualities that will match yours & have best likelihood of long term growth together. Of course, you must plan to be the best possible spouse and do not walk away at slightest hint of problems. (Same as not selling stocks at first sign of volatility, if you have done your thorough homework).
I think too many marriages ended in divorce because young people close one eye during courtship and open both eyes wide after marriage. During courtship, did not do their homework (ie FA, etc). After marriage, see all the faults & problems, and go their separate way. Same as dumping stocks & making huge losses because very little or no prior homework was done.
Money can be made in stock markets. But it requires us to invest time, effort and use our brains. Do not be greedy or simply follow the crowd. Nobody plans to fail, but problem is majority fails to plan. So likelihood of failure is high.
Enjoy life & enjoy making your money grow & multiply. Do not simply put your money into bank accounts & allow inflation to erode your savings through pittance bank interest.
Wish everyone good health and happiness.
publish-btnShare your opinions