"You need stomach and not brains to make money" is a popular universal saying in this context.
1. To gain from stocks in long term, one should be ready to withstand ups and downs in short term.
2. Only investors having a strong stomach will be able to do this while others will panic and sell their holdings whenever there's a downtrend.
3. Ability to withstand volatility by holding on to well-researched stocks for long term is more important than stock-picking skills.
4. Probability of gain / loss is very high for shorter holding periods.
5. However, investment risk comes down when holding period becomes longer.
1. To gain from stocks in long term, one should be ready to withstand ups and downs in short term.
2. Only investors having a strong stomach will be able to do this while others will panic and sell their holdings whenever there's a downtrend.
3. Ability to withstand volatility by holding on to well-researched stocks for long term is more important than stock-picking skills.
4. Probability of gain / loss is very high for shorter holding periods.
5. However, investment risk comes down when holding period becomes longer.