Long Term Stock Investment Strategies

Investment is essential but also tricky. The market must have the capacity to sustain bull periods and if not so then long term stock investment makes more sense. People often invest against better judgement as a result of whims or on fluctuating market conditions. It is thus advisable if one takes proper professional help and acts on the sound technical knowledge of such a source.

Hence the following strategies, identifiers or tips maybe used for making long term investments in India:
 

  • One should choose a financial planner whose suggestions do not have conflicts of interest.

 

  • Higher projected GDP growth and lower CAD (current account deficit) suggestive of a situation where imports are reducing or exports are improving is being foreseen in India. The gold import restrictions have also largely been successful hinting at better stock performance in coming times.

 

  • The concerns over rupee depreciation have also receded along with a strong resurgence expected from a new government at the centre in Delhi. Thus, while investment in stocks is suggested, the volatility is still worrisome along with a fiscal situation which will take a lot of efforts. Hence, one should not short but should opt for longer horizons for stock investments.

 

  • The last couple of years saw the global meltdown and slow Indian economy hence investors preferred a safer source in the form of gold. However, with a turnaround in economic welfare around the globe, the precious metal is headed for correction in a big way.

 

  • Investment experts feel with the market going through highs and lows, a good strategy for stock market investment would be dividend payout. A strategy such as the Dividend yield provides the dividend to scrip price factor will provide the much needed protection for downsides in an unstable market.

 

  • For long term investment it is essential that one has a well thought out financial plan.

 

  • One must have a reckoning of one’s own self. If an individual is whimsical or an emotional decision maker easily led then it is best to stick to mutual funds managed by professionals.

 

  • It would be a prudent strategy to keep a limit on investing related expenses.

 

  • One must have a portfolio of stocks which are going to optimise returns as well as diversify through allocation of assets across classes.

 

  • One should look at the management, dividend track records as well as debt structure.


The best stock investment is possible through patience, sticking to the long term vision, being aware and through reviews periodically.

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