Prof. Tyler yamazaki

Short-Term versus Long-Term Investment
You are free to choose how long you want to invest in the stock market.
There are many traders who invest only over the course of a single day.
Hence they are called day traders, but it is also normal to find people who
invest in stocks for more than five years. This all depends on your
preference, as well as how you want to approach the stock market. There is
no hard and fast rule as for when to classify an investment as a short term or
for a long term. Some investments begin as a short term but then turn into a

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long term in the process. For starters, most people define a short term
investment as any investment that lasts for a year. Hence, all other
investments that last for more than one year are considered a long-term
investment. Again, such definition is entirely up to you.
It is worth noting that the stock market, in general, does not fluctuate too
rapidly. Therefore, you cannot expect a big return on a short-term
investment as much as you can get from a profitable long-term investment.
Many short-term investments only last for a month or a few months.
The challenge with long-term investing is that it is more difficult to predict
how the market will respond over the course of your investment. Even
though the market is doing terrible today, it can do well after a year. Of
course, the opposite can also happen. The purpose of the investment also
matters. If you want to get quick cash, then you can aim for a short-term
investment. But, if you want to invest for your retirement, then a long-term
investment is the way to go.
It is to be noted that the market takes time to react. This is one of the
problems why day trading may not be a good choice since the market may
take more than 24 hours before it responds to your prediction. Another
differentiating factor is the strategy that you adapt. For example, for a short-
term investment, technical analysis would be helpful to you; however, for a
long-term investment, fundamental analysis would be the better choice.