Shares are for the long term

A few years ago Matt followed some professional advice and invested $35,000 in two UK listed investment trusts. He was told they offered diversification and good long-term growth prospects.

Being a new investor, Matt looked in the paper every day to see how his shares were going. He was delighted when they went up in value by 10% in the first six months. Then with the Asian crisis and the strengthening of the NZ dollar, the upward trend came to a stop. When the values of the investment fell to $30,000 Matt phoned his broker and said “sell”.

Three years later, Matt has $35,000 on deposit but he still looks at the value of the shares in the paper each morning. He feels a bit sick to think his original investment would now be worth $48,000 - had he hung in there. He wishes he had taken the broker’s advice and held on to them for the long haul.