The stock market is a great way to build wealth over time. However, it’s important to have a long-term perspective and understand the benefits of investing in long term investment stocks for the long haul. Investing in the best stocks to buy for long term investment allows investors to ride out short-term market fluctuations and take advantage of compounding returns. In this article, we’ll discuss long-term stock to invest in, how to pick them, and a list of best shares to buy for long term.
What are Long Term Investment Stocks?
Long term investment stocks mean investing in companies that have strong fundamentals and growth potential, and are held for a period of several years or more. These long term investment stocks are different from short-term stocks because the latter are typically bought and sold quickly, with the goal of making a profit in a short amount of time. Thus, the long term investing strategy involves buying and holding long term investment stocks that are focused on the company’s long-term growth prospects and fundamentals.
Top 10 Long Term Stocks to Buy in 2023
When it comes to building a solid foundation for your investment portfolio, focusing on long term investment stocks for 2023 or good stocks is the key. Therefore, let’s have a look at the penny stocks for long term & other best share to buy for long term with company share prices and market capitalization.
|Stock Name||Sub-sector||Market Cap (in Cr)||Share Price|
|Power Grid Corporation of India Ltd||Power Transmission & Distribution||₹1,72,363.44||₹248.1|
|Adani Ports and Special Economic Zone Ltd||Ports||₹1,76,850.58||₹796.05|
|Divi’s Laboratories Ltd||Labs & Life Sciences Services||₹96,386.33||₹3,612.45|
|ITC Ltd||FMCG - Tobacco||₹5,52,182.11||₹440|
|Bajaj Finance Ltd||Consumer Finance||₹4,39,816.13||₹7,211.15|
|HDFC Bank Ltd||Private Banks||₹11,95,668.09||₹1,569.2|
|Tata Consultancy Services Ltd||IT Services & Consulting||₹12,40,766.03||₹3,370.6|
|Kotak Mahindra Bank Ltd||Trucks & Buses||₹ 93,232.22||₹1,771.15|
|Indus Towers Ltd (also known Bharti Infratel Limited)||Communication Services||₹47,136||₹178|
|Eicher Motors Ltd||Machinery||₹91,852||₹3,371.75|
Note: The data is from 30th August, 2023. However, for real-time updates on stock prices and market trends, visit the smallcase stocks collection today!
How to Pick Investment Stocks For Long Term?
When selecting the best share to buy for long term, it’s important to consider a variety of factors. Here are a few key considerations:
- Company financials: Look for companies with strong financials, including a healthy balance sheet, positive cash flow, and solid earnings growth.
- Management team: A strong management team with a track record of success can help ensure the company is well-run and you can consider it as one of the long term investment stocks.
- Competitive advantage: Consider companies with a competitive advantage, such as a strong brand, unique product, or proprietary technology.
- Market trends: Search for companies that possess a strong position to capitalize on market trends, such as the transition towards renewable energy or the expansion of e-commerce.
Diversification is an important part of any investment strategy, especially when buying the best shares for long term. Diversification involves spreading your long term investment stocks across a variety of asset classes and sectors to help minimize risk. By diversifying your investments, you reduce your exposure to any single company’s risks and market volatility.
Best Long Term Investment Shares-An Overview
Let’s have a look at the long term investment stocks companies that you might be interested to invest in.
Power Grid Corporation of India
As a backbone of India’s power transmission infrastructure, Power Grid Corporation stands resilient, offering stability and growth potential. Its crucial role in the energy sector and commitment to expanding renewable energy connections positions it favorably for long-term investment.
- Moderate Risk: Stock is 2.17x as volatile as Nifty
- Largecap: With a market cap of ₹1,72,363 cr, the stock is ranked 32
Adani Ports and Special Economic Zone Ltd
With a strong presence in logistics and port operations, Adani Ports continues to benefit from India’s trade growth. Its strategic expansions, modern infrastructure, and ability to capitalize on evolving trade dynamics make it an intriguing long-term prospect.
- High Risk: Stock is 4.14x as volatile as Nifty
- Largecap: With a market cap of ₹1,76,850 cr, the stock is ranked 31
Divi’s Laboratories Ltd
Divi’s Labs, a pioneer in pharmaceutical research and manufacturing, boasts a track record of consistent growth. Its focus on high-quality production standards and strong research capabilities positions.
- Moderate Risk: Stock is 2.73x as volatile as Nifty
- Largecap: With a market cap of ₹96,386 cr, the stock is ranked 60
How to Invest in the Best Long Term Stocks India?
There are several ways to invest in stocks to invest for long term, including buying individual stocks, mutual funds, and exchange-traded funds (ETFs). Buying individual stocks allows investors to handpick their holdings, but carries a higher level of risk. Mutual funds and ETFs provide diversification and lower risk, but may not offer the same potential for high returns. Investors should choose the best long term stocks to buy that best aligns with their investment goals and risk tolerance.
However, if you’re confused about which stocks to pick, you can explore smallcases:
- smallcases are readymade portfolio of stocks/ETFs, that are based on a theme idea or strategy.
- They’re created and managed by SEBI-registered experts,
- smallcase.com offers over 200+ stock portfolios, created by 180+ managers.
- Some of the popular smallcases among new investors are as follows:
Disclosures for aforementioned smallcases
Advantages of Long Term Investment Stocks
Let’s have a look at the promising benefits of investing in long term investment stocks.
- Potential for Higher Returns: Historically, the share market has provided share to buy in India with higher returns compared to other asset classes such as bonds, cash, and real estate.
- Time in the Market, Not Timing the Market: Trying to time the market can be difficult and stressful. When investing in the best long term stocks, you don’t have to worry about timing the market or short-term fluctuations.
- Lower Taxes: Long-term capital gains tax rates are lower than short-term capital gains tax rates. Therefore, if you hold onto a stock for more than one year before selling it, you’ll pay a lower tax rate on any gains.
- Compounding: Shares to buy in long term allows you to take advantage of compounding. Thus, the longer you hold onto a stock, the more time it has to grow and increase in value. Resulting in significant gains over time.
Disadvantages of Long Term Investment Stocks
While many praise long-term investment stocks for their potential to yield substantial returns over extended periods, one might encounter certain challenges, such as:
- Volatility: Investing in the stock market can be volatile, especially in the short-term. Stock prices can fluctuate based on market conditions, economic indicators, and company-specific news.
- Lack of Liquidity: When you invest in stocks for the long-term, you’re tying up your money in an asset that may not be easy to sell quickly. If you need access to your money in the short-term, investing in long term shares may not be the best option.
- Company-specific risks: Investing in a single company’s stock exposes you to company-specific risks, such as poor management, legal issues, or competitive threats.
To Wrap It Up…
Long term investment stocks are a great way to build wealth over time, but it requires patience and a long-term perspective. By selecting strong companies with a proven track record of growth and diversifying holdings, investors can minimize risk and take advantage of long-term trends. It’s never too late to start investing in shares for long term and with careful research and planning, anyone can build a successful long-term investment portfolio.
Out of the 5 best stocks to buy in India mentioned in the blog, you can invest in Power Grid Corporation of India, Adani Ports and Special Economic Zone Ltd, and Divi’s Laboratories Ltd. However, it’s important to do your own research or consult a financial advisor before investing.
By following these steps, you can increase your chances of success when it comes to the best shares to buy for long term investment.
1. Do your research
2. Choose a reputable stockbroker
3. Invest for the long term
Yes, investing in stocks to buy for long term investment is relatively a good investment option as it helps you to fight highs and lows of the market without impacting your portfolio at a great extent.
People who have a long-term investment horizon and can tolerate short-term volatility should invest in long term investment stocks.
In the upcoming 3 years, investing in best stocks to invest for long term belonging to Banking, NBFCs (Non-Banking Financial Companies), and MFIs (Microfinance Institutions) presents promising opportunities due to the significant rise in credit growth.
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