When examining the wealthiest people in the world, a striking trend emerges. According to the Forbes Real-Time Billionaires List, only a handful among the top 100 derive their wealth from trading or hedge fund investments. In fact, the richest trader ranks only 29th, and his fortune largely stems from an early investment in TikTok rather than frequent trading.
The majority of the world’s wealthiest individuals amassed their fortunes by building businesses that provide products or services—and, crucially, by holding onto their company stocks for decades. They are long-term investors who understand that wealth is not created through constant buying and selling, but through patience and belief in an asset’s future potential.
The Power of Holding for the Long Term
Consider this: if you had invested $1,000 in Amazon or Apple stock in the early 2000s and simply held it for 20 years, your investment would be worth between $700,000 today. The same principle applies in India—investments in Reliance Industries, Adani Enterprises, or Bajaj Finance have seen exponential growth over decades.
Yet, the question remains: would you have held onto your investment, or would you have sold it once it doubled, tripled, or even increased tenfold? The difference between modest returns and extraordinary wealth often lies in the ability to hold onto an asset longer term despite market fluctuations.
Warren Buffett, one of history’s greatest investors, does not engage in frequent trading. Instead, he buys businesses and stocks he understands, and holds them for the long run. He believes in the US market. Through this strategy, his firm, Berkshire Hathaway, has consistently outperformed the market—represented by the S&P 500 in the U.S.
The harsh reality of trading is that most retail traders lose money. Despite extensive research confirming this fact, many continue to trade, believing they can outsmart the market. Statistics show that only 1-2% of traders consistently beat the market over the long run, yet countless individuals still chase short-term gains.
Why? Psychology and emotions. Many traders experience a few early wins and convince themselves they have unlocked a formula for success. This false confidence leads them to trade more aggressively, believing they can replicate their initial victories. But when the inevitable losses come, the psychological trap deepens. Instead of walking away,
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