One of the most important parts of an investment or trading strategy is the amount of time you’re willing to hold a stock before caving in and selling, either at a profit or a loss.
There’s obviously the extremes, like Citadel’s millisecond level high frequency trading or Warren Buffet’s multi-decade long investments.
I was wondering how long most of you hold your stocks. Do you buy them mostly after speculation that they will go up, and hold them for a few days to weeks or months trying to time the market? Or perhaps you try to find stocks with strong growth catalysts like consistent year over year EPS or ROE, combined with the a few year time horizon on the company’s business activities.
Or do you look at it very long term, trying to find undervalued stocks that you believe the market will eventually the potential of? Whether months, years or decades, you try to find stocks that you believe the market will eventually value correctly.
I know some people have multiple time horizons and it depends on the particular investment, so what determines which stock gets which time horizon?
I’d like to know how much success your investment time horizons have brought to the valuation of your portfolios.