During this time of extreme volatility on the S&P/ASX 200 Index (ASX: XJO), it can be easy to lose sight of what investing in ASX shares is all about.
You might have already 'sold everything' in order to 'wait for the bottom' before trying to buy back in.
You might also be just hanging on for dear life.
There's no doubt that keeping a long-term perspective is more important than ever in this trying time.
As is remembering that the shares you own represent a real and quantifiable part-ownership of a business.
If you owned a part-share in a farm, would you bail out when your neighbour offers you half the price that you bought the farm for?
Probably not, I'd wager.
What someone is willing to buy your farm for doesn't affect how much wheat, corn or beef that farm can produce from now until the end of time, after all.
A better strategy than selling that 'share' to your neighbour would be to ask them how much they would sell you their farm for. If it's for that same red-hot price, why wouldn't you jump at the chance?
The same logic can be extended to the share market.
There were people willing to buy CSL Limited (ASX: CSL) shares a month ago for $340 a share. So I'm wondering why on earth many of those same investors would have been selling CSL shares yesterday for $276 a share…
It defies logic.
Has anything changed with CSL's business? Not really. It's still an increasingly profitable business in an evergreen industry with a growing dividend.
In fact, CSL is in the healthcare space (including vaccine research). If anything, its short-term business prospects have increased from the outbreak of the coronavirus.
Yet, people are selling their ownership of this company just because their 'neighbours' are offering a cheaper price over the fence.
Foolish takeaway
I think all investors would be better off adopting this kind of attitude to investing. Buying ASX shares means buying ownership in the cash-generating machines we call companies. If a company is still generating cash (and shows no signs of ceasing this ability), why would you bail out? Because the next 12 months might be a little rough?
So when you look at your shares and the broader market today, remember what you're really buying or selling! In 10 years' time, will you thank yourself or not for your actions?
