Good Investing Lessons

As a long term investor, you do not need to flee the market unless you are near to the retirement age (meaning, you are no longer "long term" in your investment). For many long term investor, they would say that the fundamental is unchanged. So, their stock valuation should not change. However, we must not be complacent about it. Fundamental do change when the market condition changes. That is the fact. How your stock will be affected depends on a few factors. The number one factor is whether the stock that you purchase is directly involved in the sub-prime loans. If they are, then the fundamentals of that company is changed immediately. The profit will be affected directly. So, if you are holding banking stocks, you may suffer loses. That amount will depend on what level of involvement your banking stock participates. However, if you are holding stocks of MacDonalds or Coca-cola, the impact to your stock will be minimal. You may see immediate price down but the prices will c...

Assuming that you have decided to become a long term investor. You have done your homework and started to purchase some stocks. The Dow Jone Industrial Average down by 281.42 (2.09%) last Friday. Are you concerned about how your stock portfolios are affected? Should you be even concerned at all? The truth about long term investment is that you do not need to have sleepless nights. You do not need to be checking your stock prices everyday. You do not have to be concerned about price fluctuations on daily basis. You only need to be concerned about price movements over a larger time horizon. Remember, all the stocks has been picked based on good fundamentals. Currently, the over market is still good. The long term trend for stocks remains positive. What does that mean to you? Your stock prices should be heading upwards in the long term. In the short term, there may be some days where the prices are down. Eventually, the price would go up. The truth is that if you are worried about the d...