Is long term investing dead, or still alive? Everyone and their uncle are panicking about buy and hold no longer working. But that is not true when you look at the past.

There can be many different ways to make money in the world of investing and shares trading over the long haul when you figure out where you have an edge and you stick with taking advantage of it.  You don't need to win on every trade and you don't need to try to make your fortune on any one trade.  What you do need to do is manage your trading so that you limit the risk of losing all of your money in any particular trade as well as spreading out the risks you are taking over a number of ideas so that if any one of them is a total loss you still have money to stay in business.

The last 10 years or so have been unusual, there were two bear markets during that period and anyone who bought 10 years ago is just a little over break even. But if you look further out you will see that buying stocks tends to work very well for anyone who can hold onto it for 20 years or more.

Buy and hold is not dead for 3 reasons:

1. Past History

If you look at a chart for 20, 30, or 40 years it is plain to see that the overall direction is up. The longer you hold onto stocks the more likely it is you will be profitable. That has been true ever since the stock market was created and it will not change just because of the last few years.

2. Dividends

Stocks that pay dividends do not need to move very high in order for you to get a good return. If you where in the stock market for the last 10 years and all of your investments are around the same price you bought them at it could be a little disappointing. But if you were getting a 5% dividend on those stocks then you still made money regardless.

3. Strong Companies will Always Grow

Strong companies with great business plans will always grow and prosper. This means that there is always opportunity to get a great return, even if the overall market is having a rough couple of years.

At times of unstable market, when it becomes risky to make any investment and especially on stocks and shares, diversifying and reshuffling of portfolio is necessary. Thinking long term for an investment becomes a way out as most short term investments on stocks and shares suffer more decline in value.

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