With so many people trading stocks every day, it might seem wise to look to a longer time horizon than just trying to make money overnight. What is a long term time frame? Warren Buffett points out that even three to five years, a seeming eternity to some trade-happy investors, is not really sufficient to give you the safety you hope to gain as a long term investor.
“If your time frame is three to five years, A.) I wouldn’t advise it being that way, because I think if you think you’re going to get out then, it gets more toward, leaning toward the bigger fool theory,” Buffett said at the 1998 Berkshire Hathaway annual meeting. “The best way to look at any investment is how will I feel if I own it forever? You know, and put all my family’s net worth in it.”
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© 2022 David Mazor
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.