One of the fundamental principles of investing is to invest with only the money you will not need in the short-term. In other words, do not use your mortgage payment or rent money to invest with. In my opinion that is called gambling. So, by the very nature of investing, you should be prepared to part with your money for an extended period of time.
Although there are some investments that can be profitable in the short term, like investing in real estate or collectibles like fine wine, investors should focus on investments that will deliver returns “down the road.”
A time tested strategy for making money investing in bonds is called “rolling down the yield curve.” This strategy involves buying longer dated bonds and selling them after twenty four to thirty six months, to profit from their rise in value during the first few years. This investing strategy is profitable for two reasons: the longer term bond pays more interest than the shorter-bonds, and the longer-term bond will rise more in value over time.
Exchange Traded Funds
Because exchange traded funds, more commonly known as ETFs, can be economically acquired, held, and sold, some investors invest in ETF shares as part of their long-term investment strategy. With just two or three ETFs, you can create a portfolio that covers nearly the entire equity market, as well as a large portion of the fixed-income market.
The shipping container is one of the most important contributors to the growth of world trade. Because the lifetime of a cargo container is more than 10 years, investing in shipping containers is regarded as a long-term investment. During this decade-long period, investors can expect to earn a monthly return based on the performance of their container fleet.
The purpose of a long-term investment plan can be to supplement an investor’s income during unemployment or retirement, or protect an investor’s portfolio against a worse-case scenario. In either case, it is important to focus on investments that deliver consistent performance, over a long period of time. This approach will work to preserve and build wealth.