It depends who you ask. In this example I will talk about the idea of holding a stock for a few years, but even though I’m speaking about investing in stocks. For a beginner like me, holding a stock for a long time is not a bad strategy, especially if an investment you like isn’t yielding a lot of cash. A few years is a good time to hold stocks that give the best return for your dollars.
There are several things to look at when determining how long to hold a stock.
A long-term track record, which is the most important piece of information in a stock investor’s mind. Some stocks have such a track record as to make them easy and fast to buy and keep investing in, although no two investments will have the same track record. Generally speaking, companies with good track records are ones that are good investments for long-term investors and those with poor track records are ones that may not deliver cash quickly and are therefore more suitable for short-term investments or in some cases even for investment strategies.
How well shares are performing on a consistent basis. How does a stock perform once a set amount of time passes in its stock’s history?
As mentioned earlier, a good indicator of market performance can be in a stock’s price over a set period of time. You can also look at how much a stock should be valued when you have a large amount of money that you invested in it over the years. In this case, it doesn’t really matter how much a stock is worth when you have the money to buy shares, and in the long term, holding a stock for a long period of time should be used as a strategy to acquire a large amount of shares at a good price, even if the stock’s price may not give the best return on your dollars, especially over multiple years.
How good is the price of a given stock when you buy it?
When choosing stocks to invest in, it’s easy to buy stocks when they are just on a certain price range, say $150-$300 at the latest, when you don’t know that you will actually get any profits. But in general, even if you buy a stock at an extreme low price, you should consider that it may still perform over the short to medium-term period. The reason is simple. A stock is only as good as the stock price, and the price of a very low-priced stock may not be worth its cost unless the stock becomes more expensive
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