“Buy Right and Sit Tight“
Great advice, but it’s easier said than done. How do you know what is “right”? How much should you put in one investment vs. another? If I sell, when should I sell? If I buy, when should I buy? Where should my dollars go today so I am financially independent tomorrow?
It’s very difficult for an individual investor to analyze thousands of stocks to identify what the “right” investment is for them. It is also very difficult to not get emotionally impacted by an investment. It’s down, should I get rid of it? It’s up, should I buy more? What do you do and when?
Instead of getting attached to a stock or a fund, we need to be anchored in the empirical evidence and the plan behind an investment strategy. It allows us to adjust when we need to, stay the course when things get rocky, and ultimately reach the financial independence we all desire.
So how does one answer the question of “How do I buy right and sit tight”? That answer is Asset Allocation. Read on.