Should I Stay in the Stock Market?

Invest for the long term can help you achieve financial goals

Investing for the long term avoids short term dips

Investing with a long-term horizon in mind allows an investor sidestep temporary stock market dips and downward trends. An investor who stays invested for the long haul is more likely to attain financial goals and reap rewards for his/her investment. Also, when an investor has a long-term investment period in mind, he/she can re-arrange a portfolio to take advantage of gains, minimize losses and average cost investments.

The stock market is uncertain and unpredicatble

The stock market is very uncertain, unpredictable, and at times, volatile. Even in the best of times, stocks can be affected by dramatic price swings both up and down. Investors who need their money in the near future (5 years or less) should be invested in more stable instruments like certificates of deposits, or U.S. treasuries, bills or bonds. The stock market is not the place for nervous investors.

Bottom Line

Investing long-term has helped many people reach their financial and retirement goals. However, investors cannot be passive. They must monitor their investments, invest wisely, not gamble, and not be emotional to market swings. Investors who invest for the long haul can ride out market downturns, and eventually bank the rewards. Stocks do not come with guarantees, and that should always be considered.

References

• Final Sense: Comparing short/long term investments
• Stock Market Investors: Long Term Investing