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Playing The Long Game

Why long-term investors shouldn’t worry about daily market volatility.

Presented by J.L. Bainbridge & Company, Inc. March 2, 2018

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Recent market activity, like the abrupt decline we saw in February, has many people understandably unsettled about their financial future. If you’re a long-term investor, however, these minute-by-minute fluctuations should serve as an important reminder of your big picture strategy. Gains for long-term investors are won not on daily market oscillations, but rather from growth experienced over many years.

So what’s the right move in this tumultuous environment? Stay the course. Armed with a proven investment philosophy, you can rest easy knowing you’re on the path to reaching your goals.

Read on to learn more about the advantages of long-term investing.

Quality over quantity
Quality investing, when executed correctly, negates the need for accumulating a myriad of weaker investments. It’s better to own a few shares in select companies that will help you build wealth over your lifetime, rather than to fill your portfolio with more tenuous bets. Of course, you need to invest in strong, profitable companies to reap rewards from the long game. Stocks with high quality indicators generally experience less volatility and pay off over a number of years. For example, our investment portfolio typically includes only fifteen to twenty stocks, as these are all we find that successfully meet our stringent criteria and are available at an attractive price. Determine what gives certain companies an edge over their competitors, whether it’s significant cash reserves, growth history or other factors. You’ll be able to rely on these assets when the rest of the market inevitably dips.

Emotions? Out of the equation
While it may be tough to remain unwavering during a market dip like the one we saw in February, you can rely on an investment philosophy that focuses on minimizing risk and maximizing gains in the long-term. You’ll be able to sleep better at night knowing that short-term volatility won’t make or break your financial future.

Make your money work for you
Long-term investing is a profitable strategy because it takes advantage of interest. When your earnings are reinvested, you’re propelling your capital for further growth. The earlier you invest and the longer you stay invested, the more your assets will grow. Given time, a relatively small initial investment can turn into a sizable chunk of money.

Ignore the hype
Stock market buzz can be overwhelming and doomsday predictions can give investors cold feet. 2017 is an excellent example of when ignoring negative predictions and adhering to a proven strategy paid off. At the beginning of the year, a prominent national newspaper published a survey of sixteen leading stock market strategists that revealed their projected average 2017 return for the S&P 500 was only 5.4 percent. Investors following this advice may have exited the stock market to wait for better times, thus causing them to miss out on one of the stock market’s best years.

A dedicated financial advisor with a proven investment philosophy will help you focus on the future and achieve your financial goals in the long run. So before you get caught up in the clamor, call your advisor to talk through your concerns. They will likely tell you to stick with the strategy to see impressive long-term returns.

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Joel G. Oldham
Senior Vice President

Joel Oldham is a senior vice president at J.L. Bainbridge & Company, Inc., a Registered Investment Advisor (RIA) who has helped clients build wealth for more than 35 years. Joel has been with J.L. Bainbridge since 2002, bringing the knowledge and experience he accumulated working with Morgan Stanley Dean Witter and Charles Schwab & Co., Inc. As a senior vice president, he serves as a member of the Investment Committee, participating in the identification and review of companies and instruments considered for investment.

It should neither be assumed that future results will be as profitable nor that a loss could not be incurred.

Contact J.L. Bainbridge & Company
, Inc. to take the next step into your financial future.

1582 Main Street, Sarasota, FL 34236
(941) 365-3435