Top Buys for a Long-Term, Sleep-Well Strategy
Nate Pile is a true long-term investor, buying stocks with a three- to five-year time horizon and often holding positions for decades. Here, the editor of Nate’s Notes explains his strategy and highlights a trio of favorites, a video game maker, a media and theme park giant, and a closed-end biotech sector fund.
Steven Halpern: Our guest today is Nate Pile, editor of the top-rated newsletter, Nate’s Notes. How are you doing today?
Nate Pile: Fine, thanks.
Steven Halpern: You’re well known for a strategy that avoids the noise on Wall Street. Instead, you focus on long-term trends and often hold stocks for many years. How important is this approach to successful investing?
Nate Pile: Well, it’s helped the newsletter generate the sorts of returns it has because we’ve looked for great companies. When we get into a company, we always have at least a three- to five-year time horizon and some of our stocks have been in the newsletter for close to 20 years now, but it helps to, sort of, tune out the noise. We don’t try to trade every zig and zag that happens in the market.
We intentionally make trades just once a month when each issue comes out, so 12 times a year we rebalance our portfolio a bit. Having followed…I got my start in following the biotech sector in the late 80s and early 90s, so I’ve been doing this for a while.
The longer you do it, the more you realize that uptrends go on for a while and then they change and become downtrends for a while, and the most important thing to do is to be on the right side of that trend and then ride it for as long as you possibly can, again, rather than trying to trade every little zig and zag a stock makes over the course of a five-, or six-, or eight-year bull market for a sector.
Steven Halpern: In your latest issue, you emphasize two seemingly simple but very important and hard to follow mantras. Specifically, the endurance of trends—as you just alluded to—and the importance of focusing on what the market is doing, rather than wondering what the market might do.