One of the pivotal aspects of trading education is learning about the two major kinds of investing options out there – stock trading for short term gains by buying and selling stocks based on market ebbs and flows, and long term investing by buying stocks and holding them for a long period of time irrespective of temporary stock trends. Any decision needs to be backed by data.
Long term thinking has never failed in investing. Buying and holding stocks is less risky and easier to master than short term buying and selling based on stock falls and rises. Here are two stocks that experts at NASDAQ believe are ideal to buy and hold well into the next decade, and the first one is the king of social media, Facebook ($FB).
It has ended Q1 by setting a record – 1.94 billion active monthly users and 1.28 billion active daily users. Mobile advertising accounts for 85% of revenue generation, which is an increase from the 82% in 2016 Q1. The number of users is one of its major strengths, but there's something else too. It owns seven of the world's major social networks – Facebook, Facebook Messenger, Instagram and WhatsApp. Owning all this gives Facebook great ad pricing power.
It still has WhatsApp and Messenger to monetize, and only recently has it increased advertising on Instagram. The potential is immense. Facebook's current average revenue per user in emerging markets is significantly below the revenue of US and Canada, which means there is a lot more to attain. It is a multi-decade growth stock right there.
Visa ($V) is another stock that could continue its industry leadership to the next decade. It has a 50.6% share of the payment processor market in the US. That's 28 percentage points higher than its nearest rival. It is therefore always the sought after payment partner. According to Wall Street analysts, this payment processor could experience annual growth in a double-digit percentage, and since it isn't a direct lender there are no worries of loan delinquencies bringing it down.
It's really expanding overseas as well, acquiring Visa Europe. With around 85% of transactions in the world still carried out in cash, the potential is ample for this market leader to grow in Southeast Asia, Africa and the Middle East. That makes it another multi-decade growth stock.
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