Monday, December 28, 2009

Short term trade or the buy and hold strategy?

I got a comment on my post, and this is the question I also ask my self a lot of times.

What strategy is better? Short term trade or the buy and hold strategy?

I created this blog, as a journal on my action based on what I currently think. So that I can review it from time to time and learn from my mistakes.

In summary though, based from my experience short term is the best way to make a killing. But it requires a lot of work like analyzing company news, analyzing external factors (i.e. DJIA, Gold Prices, Unemployement Data), fundamental research, reading the charts, asking around people who knows the company well.

I don't have time for that type of work anymore, so I'm sticking to long term strategy. If ever I'll try to be a short term trader again, I might have to quit my job and make day trading as my day job. Also, long term strategy does not mean buy and forget, you should still set your Cut Loss levels.

Short Term :
I made a killing on MER before, that's short term. I just really knew that the stock will rise due to the turf wars (MVP vs SMC).

Long Term:
As for my long term, I made a fair profit on AC, MEG and SMDC.

Other long term picks such as SMB and CHIB still has not gave me what I expected.

As for my opinion, short term trading is really like Sniping, "One shot, One Kill". While long term trading is like using a .50 calibre "Point and Spray".

Both methods will give you frags; however, the other just requires more skill and patience but has a better return.


Jonha said...

For starters like me, I think long term investment is ideal when compared to short term because once you're seasoned and you know the trends, you can try to manipulate your stocks.

n00b trader said...

thanks for sharing. ill keep in mind that, the higher the risk, the greater the returns and also, we shouldn't invest money we can't afford to lose