Long Term Investing

I posted the below article in one of Singapore investment forums.

We always hear “take a long term perspective when investing. If we are young, we can take on a higher risk for a potentially higher reward.” Suppose we have a 30-year horizon and we invest in equity and equity funds (assuming they represent the high-risk instruments). After the initial investment we never touch the investment (so that to take a long term view) and periodically we re-evaluate the investment (and find it still valid). After 2-3 years, we find that our portfolio did not grow, or worse it shrank. Nevermind think long term. 25 years on, same thing still. What should we do now? Long term did not pay off and time is running out. Should we continue to hold on to our 30-year view or should we "cut our loss"? If we get out now are we missing out the long term benefit of the stock market. No matter what, time left for long-term is running out.

My points:
1. With a 30-year horizon, we do not really have the full 30 years to involve in a high-risk-high-return type of investment.
2. Any incompetence in investing will be compounded over the investment period.

I later posted a supplementary one on the same topic.

Perhaps I may point out what I missed out earlier. Long term investing is not just about buy and hold, till death do us part style of investing. It should not even be viewed as an investment style. It is about money management over time. Even before we put in the first dollar, we should think about where our end point is. Long term investing makes you think about your exit point. Unless you are trying to leave behind a legacy like our Great, we would at one point or another want it out. That point is the investment objective. My investment objective is to hold a portfolio of stocks/cash that will provide me with a monthly income of $5000 (of year 2000 money). With the objective in mind, we can then beat the path towards it. In our journey, we find that every step we take is important. Just like a navigation exercise in Mandai jungle using only a map and a compass. An error in either the interpretation of the map or deciding on the wrong bearing will lead you away from reaching your objective.Therefore, long term investing is not jumping into a risky investment, and hoping the investment appreciates some time during your waiting period. Long term investing is made up of all the little steps you take and the decisions you make while navigating through the investment jungle to reach your investment objective.

Original text is edited for clarity