Investors select quality investments and hold them for years, benefiting from compound interest and potentially lower taxes, here are some things to know.
1
You buy investments intending to hold them for years or even decades, Short-term market ups and downs are less important.
2
This strategy requires patience to ride out market volatility and trust your investments will grow over time.
3
While holding long-term, you still want to choose good investments, Research companies or choose well-diversified funds.
4
Buy and hold is passive investing, You buy and hold, not actively trading based on market movements.
5
Less trading means fewer transaction fees and potentially lower investment management costs.
6
Long-term capital gains taxes tend to be lower than short-term gains taxes.
7
Reinvesting earnings allows your money to grow exponentially over the long term.