“Do good in the world, make a lot of green and live a glamorous life.”

Do not go where the path may lead, go instead where there is no path and leave a trail. Unless the path is paved with money. Then maybe you should backtrack your pretty little heels to the fork in the road that you got lost and reevaluate your direction. While I am a firm believer in Ralph Waldo Emerson’s quote, and being a ball gown in a room full of tuxedos, I’ll be the first to admit that teachers and mentors are the way to go when it comes to a field you are not yet an expert in. And speaking of Tuxedos, it may be time to hop on someone’s coattail if you’re interested in upping your investment portfolio. Coattail Investing is a clever strategy where you play copy-cat with established investors who have already conjured an elaborate amount of success. Monkey see, monkey do.

Do It Like A Pro

You know how they say if ain’t broke, don’t fix it? Same goes for this. When you see something that works, why not learn from it? Mimicking money managers and institutions that have proven success rates only takes a bit of research and a will to make money… don’t we all want a bigger bank account? Coattail investing works best when tied to a long-term stock, a buy-and-hold mentality. Think of it like a boyfriend, if they’re in it only for the short-term, your reward is not as substantial. Okay maybe some good dinner dates, a few sexy sleepovers and the honeymoon phase, but that’s nothing compared to a lifetime of love, loyalty, support… oh, that beautiful ring… marriage, kids. Okay, we are getting off track here. I started day-dreaming about sailing in a Riviera. But we will never have that sailboat and trip to the Rivera if we don’t have the funds, and WE WANT THE FUNDS! So, buy-and-hold. Get to it.

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Buy what? Hold who?

No, no, no. This isn’t a shopping spree or a cuddle fest. We are talking about stocks here.  The buy-and-hold strategy is the way well-known investors keep stocks over extended periods of time without paying mind to the market fluctuating.  It is a passive approach, while investors are still actively purchasing stocks. Once placed in the portfolio, short-term price movements and technical indicators are but a fly on their shoulder… they just flick it off, unbothered.  Plus, the buy-and-hold investments are taxed at a lower rate than buy-and-sell ventures. That means more money for you.

Prefer It To Be Common

Coattail investing will tell you to purchases shares of common stock instead of preferred stock. This will allow you to take ownership of a company and have both voting rights and a pocket-full of corporate profits upon expansion. Since you’re such boss, you’ll be happy to know that your role as a shareholder entitles you to decision making and electing directors to the board. The more shares you hold, the more votes you have. Oftentimes, common stock investors intend on acquiring representation on the board, and if they own a substantial amount of shares, their influence over management is quite powerful.  Although common stock shareholders risk losing it all, on the flip-side, they have the opportunity to receive an incredibly enormous return. Hello, sugar mama!

It’s Time To Stock Up

The Morningstar put out a study that claimed purchasing stocks at a market cap between $2 billion and $10 billion, and then holding them for at least a 10-year time span, will result in a 50% outperformance rate. Although there has been arguments stating that short-term investing allows for a fixed income, most notable investors know that there is value in commitment.  They say patience is a virtue, so why not be virtuous AND extremely wealthy? So, go on girl, hop on that coattail and ride it like Jasmine on the magic carpet. The reward will truly be ‘A Whole New World’.