August 25, 2006, Newsletter Issue #31: Buy and Hold

Tip of the Week

The stock market consistently earns higher returns on investments over time than other investments. The key to taking advantage of the higher return rate is to adopt a "buy and hold" mentality. This means that rather than buying stocks with the intention of selling them soon for a quick profit, you buy with the intent to hold onto them for the long term. Thinking long term about your stock portfolio is more difficult than you might expect. Daily stock price headlines and periodic market slumps or crashes can rattle your most rational investing nerve. Commit yourself to a buy and hold investing policy and stick out the rough times in the market in order to see the best returns on your investments.

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