Insight: All About the Long Term

While value investing as an emphasis on patience and longer term holding than most other investment strategies, given the fact that investors must buy stocks at depreciated valuations and hold long enough for catalysts and market events to accumulate in order to take the stock back to a fair valuation, a value manager needs to have foresight beyond just their current holdings.

Even if a stock is undervalued and everything checks out on your end, external factors play a major role in how the investment actually plays out, meaning value investors not only have to be great at stock picking, but also have to be market maestros and truly understand the inner workings of financial markets in order to successfully command their portfolios.

That isn't to say losses are completely avoidable.

That's simply not true.

Even the greatest value investors like Buffett and Graham had down years, but one thing separates them from the rest of the market and is the reason for their dramatic outperformance over the long term.

Capital preservation.

Value investors stand out during downturns because they know where to park cash and have foresight into how both the economy and financial market will unravel.

With that being said, let's take a look at my take on where both the economy and in turn the market will be going from here... and what we can do to navigate it.