Keeping track of your investments

Keeping track of your investments

"The speed of business is higher, and the speed of business change has increased. To hold a stock with a long-term goal of forever is a great idea, but things change so fast it just may not be possible."

Supposedly, a value stock was to be acquired and kept for a long time, even a lifetime. True, but especially in today's world of change, business fortunes can turn on a dime, either as a result of macroeconomic and industry factors, or micro problems that escaped your initial read and surfaced during ownership.

According to a recent study, the average stock fund holds a stock for 1.2 years, down from 3 years in 1976. Some funds "trade" actively, but most don't - they simply react to change in business and business conditions.

The point is that you have to keep up with your investments, even after purchase. If you were fortunate enough to do a good job up front, nighttime sleep should come easy. Stability and consistency are good things to have. But no longer is it possible to buy a company and stuff the stock certificate into your mattress. Even Buffett sells shares, and sells them every year.

The best way to keep track is to use many of the same tools used to make the investment decision in the first place. Watch the financials and intangibles through Yahoo! Finance, quarterly Value Line updates, and of course, the newspaper. Repeating the "short-form" appraisal every now and then doesn't hurt either.