December 25th, 2008 by Damian Papworth

There is no doubt, 2008 has been a terrible year on the investment markets.  If you invest, the chances are your net worth will be less now than it was at the start of the year.  This is a good opportunity to remember what investing is about.  Investing is the gradual building of wealth over a long period of time.  Ie. Its a long term activity.  Trading is the short term activity.

The investment markets will always tend upward over the long term, however they will also always have temporary corrections and bigger crashes.  2008 was without a doubt, one of the years when we saw a crash.  During these times, there is a tendancy to throw the baby out with the bathwater, as all we can see is the terrible short term results.  However, we should not do this.  We should look at the long term performance of our portfolios.  Ie. How do they look now as compared to 10 years ago, not 12 months ago.  This is the real test of an investment strategy.

Once you have done that, look at the short term trading methods and see if they can be refined for the non-performing periods.  And then make sure you remember the refinements and implement them the next time a similar period strikes

investing perspective, long term investing, market crash, short term trading, trading strategy