Characteristics, Selection, and Investor Mindset for Stocks Worth Long-Term Investment

Before learning or understanding stocks worth long-term investment, it’s essential to recognize your own investment style. For long-term investors, time can reveal the true quality of a company’s operations. This approach is not about analyzing whether a stock is part of a hot trend but rather focusing on the underlying strength of the company’s business.

Stocks worth long-term investment can be considered from four perspectives:

1. Value Investing
   This is a widely studied method among investors and a popular long-term holding strategy. It often draws inspiration from Warren Buffett’s investment philosophy, emphasizing the calculation of a company’s intrinsic value. The price-to-earnings (P/E) ratio is a common metric, and determining a reasonable P/E is a key concern for investors. Buffett’s approach of cash flow analysis is also highly effective. For example, low P/E stocks like bank shares are often favored.

2. Contrarian Investing (Templeton’s Global Strategy)
   The logic behind global investing is that “when one market underperforms, another may thrive.” There are always undervalued opportunities in low-cost markets. The key is identifying and buying into these markets at low prices, though this method can be challenging for average investors. This strategy can extend to multiple markets or sectors, as stock sectors rotate—deep research is needed to uncover undervalued stocks.

3. Growth Stocks
   These are stocks with strong performance and promising prospects. Analyzing them requires in-depth industry research, including policy and fundamental factors. Investors can align with national economic trends and select leading stocks in rapidly growing industries, then assess their financial health. Another criterion is dividends: companies with consistent dividends are preferable, while those that rarely pay dividends but frequently issue new shares carry higher risks.

4. Riding Macro Trends
   For example, this year’s new energy vehicle concept stocks. Success here demands accurate trend forecasting and strong information-processing skills. Early adopters profit; latecomers may face bubbles.
   
   

Among these four methods, the first two are solid choices—mastering one can achieve investment goals. The third requires professional analytical skills, and the fourth relies on information-processing ability, both of which are harder to master. While learning all is beneficial, specializing in one is recommended to avoid strategic confusion.