September 9, 2016

Stock purchases are like buying a house

It’s hard to beat the stock market - unless you make it your calling and it’s not my calling. This is why I invest without trying to beat the market. I am happy with the average stock market return. It’s much higher than the returns on bonds, the price increase on gold or the interest in a bank account.

Last but not least, with my stock purchase, I become part owner of a company I like and that makes me feel good.

That’s why I invest in companies I like, in the geographic markets I am interested in, that sell good products and share my values.

For me, buying a stock is like buying a house: I decide where I want to live after thinking about the surroundings, the community and the house itself. I see if it all fits before I buy it.

When I buy a house, future price increases are not my primary motivation. That is too difficult to predict. I buy a house because it renders a service for me. It should be the same with stocks. I buy stocks because they put my money to work. If they happen to outperform other stocks, that’s my good luck.

Looking at stock investment in the same way as buying a house makes it much easier to decide which stocks to buy.

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