When a stock of yours is doing well, one of the hardest things you will face is deciding if you should make a decision to take short-term profits, especially if you strongly believe the stock has much more potential in the long run. But it gets even worse. Sometimes we make decisions to hold onto stocks longer than their expiration dates because of the “what if it goes up” thoughts that creep into our minds

You want to hold it, but on the same token, you are not being fair to yourself when your discipline promotes a making-money strategy. 

Now, I could have just as well started this post…one of the hardest decisions you’ll have to contemplate as an investor is to let a stock with great potential sit in your portfolio for a very long time. You have faith, after your hours of due diligence, that it will give you great annualized returns in 5, 10 or 20 years, but what if it doesn’t happen on your timeline?  Would the capital that would have been made available with a more swing-style trade be better deployed in another investment? And should you even preoccupy yourself with these thoughts?

Investing mistakes are common. They are made every day by thousands of investors looking to make a quick buck on YouTube hearsay, a Twitter tip, a Reddit forum discussion or “TikTok guru” just out of college. This leads to poor choices, leaving them vulnerable to misinformation, biases, and market volatility. It ultimately jeopardizes their financial goals.

Basically, when it comes down to it, there are many corners of the internet that prey on the inexperience of new investors, or the apathy of those who don’t see the value of proper due diligence (DD) to confirm, for themselves, if a certain stock is a legitimate investment, or just one that fits within their investment style.

Failure to perform proper DD and document findings is one of the foremost failures that investors face. Unfortunately, it is not the only mistake that is often made. Others include focusing too much on short-term gains, poor portfolio risk management, lack of buy and sell discipline and emotional biases.  Over the coming weeks, we’ll address some of these specifically, but today we are going to stick with the research theme since that is the one that in most cases kickstarts the whole process of finding the right stocks.

I was reflecting on a past GeoWire Weekly post from November 2022 where I addressed some factors that made Ufp Technologies, Inc. (NASDAQ:UFPT) a standout case study in what can happen when company management values maintaining the integrity of capital structure while growing revenue and EPS organically and through acquisitions – UFPT, a designer and custom manufacturer of components, subassemblies, products and packaging utilizing highly specialized foams, films, and plastics primarily for the medical market, made eight acquisitions since 1993.

The company relied on its strong balance sheet to minimally increase its share count as EPS trended higher from 2004, when its bottom line went positive, to 2022, the first time its adjusted EPS broke $3 per share.

I no longer avoid investing in Canada based companies. When you screen for stocks to buy, you might have a desired set of criteria on a quantitative, qualitative and geographical basis.

If you isolate your screen to Canada, natural resource companies will dominate your list. If you love to invest in these types of companies, many of which are in the early stages of development and specialize in mineral and oil exploration and extraction, you’d be in luck.

Canada is one of the most resource-rich countries in the world as the global leader in potash production and a top five global producer of diamonds, gemstones, gold, indium, niobium, platinum group metals, titanium concentrate and uranium. Canada is also the world’s fourth-largest primary aluminum producer, and has the third-largest oil deposits after Venezuela and Saudi Arabia.