Stock Market Investing - Hike of a lifetime!

Stock Market Investing - Hike of a lifetime!

As I thought about my hike on the Whistler mountains, some similarities came to mind between hiking and investing. The narrow trails with uphill climbs, descend and gravel paths through the forest remind me of the path one has to take during their investing journey. When one goes on a hike they set goals like pushing themselves to new heights or breaking their distance record. But through their journey, they may have to deal with bad weather, terrain, hunger, physical injuries, and sometimes sickness. I would say the same applies to Investing in the stock market.

But what is investing? To me investing is taking some resource and advancing it or taking something and increasing its value. I take a little bit of my money every month and put it in some high-quality stocks or index funds with the goal that when it is time when I can not work anymore, I have a golden nest to retire on and that it will provide an income that is available to me throughout my life. I call Investing a trail with a purpose.

The stock market is not always on an uptrend there can be periods when the market drops and your investments can go down by half their value. This can trigger a roller coaster of emotions and one has to navigate these turbulent times in their investing journey. But it is reasonable to expect that long-term investing in the market as a whole will continue to return profits. But to invest wisely is the goal.

A lot of us have made the mistake of putting some resource of ours into something but only to see it get washed away. You may have had stocks in your portfolio that went to 0 or dropped significantly in value and never bounced back. Mistakes like these take you a few miles back from where you were on your investing trail. It is like getting lost while on a hike walking miles wasting your energy and resources all to realize that you’ll have to walk back and start from where you went off-trail. Observation is a key skill one needs say it be hiking or investing. So the key to investing wisely is to take a look at the object that we are going to invest in. We have to look at it closely and examine it to the best of our ability.

Historically, the stock market return has averaged about 8% but future results may be different and exact results will depend on when and how you invest. This doesn't mean that any individual stock will go up forever nor it means that any given index will go up forever. But there will be growth in the stock market as a whole. I would say the stock market is a positive-sum game since it is driven in large part by the financial performance of companies. This is why I believe picking the right stocks for the long term is key to success. But past financial results are no guarantee of future returns. So I also feel it is equally important to monitor the performance of your stocks in regular intervals.

In the subsequent blogs on Investing we’ll be sharing some tips to identify, pick the right stocks and monitor them with confidence. Our goal at Trailo is to hike by your side through your investing trail.