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If you want to invest for the long-term, what are your options? Here are two investment strategies to consider…

by , 10 December 2014

If you're looking for a long-term investment strategy, you may think your only option is buy and hold.

But there are other investment strategies to think about.

So what are these other long-term investment strategies?

Read on to find out…


Investment strategy #1: Multi-asset investing


Multi-asset investing is an investment strategy that involves not having all your money in shares. Instead of investing solely in shares, you allocate a target proportion of your savings into other investments.

These other investments could include precious metals, property and bonds.

To follow an investment strategy like this, you watch the performance of each asset, Phil Oakley in Money Week explains. When a particular asset does well, you sell some of it to bring your rebalancing back to your original target.

For example, the stock market does really well, so you sell off some of your shares to bring the amount invested in shares back to your original target allocation. You can then use this freed-up cash to buy more of an asset which isn’t performing as well.

By following this type of investment strategy, you hope to take advantage of high share valuations and reduce the risk of just holding on.


Investment strategy #2: Let you dividends compound with individual shares


This is a more focused investment strategy than buy and hold.

You build a concentrated portfolio of just a few shares. You watch for fundamentals that could affect your investment, such as business prospects, financial conditions and the intrinsic value of the shares.

As long as these fundamentals remain reasonable, you hold onto the shares. When you receive any dividends, you reinvest the cash to buy more shares.

This strategy works particularly well with high-quality companies that have strong, predictable cash flows.

So there you have it. Two investment strategies to consider if you want to invest for the long-term.

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If you want to invest for the long-term, what are your options? Here are two investment strategies to consider…
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