I believe buying ASX shares when they're cheap can set an investor up to realise greater growth and, thereby, returns over the coming decade.
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Cheap ASX shares can house notable opportunities
The last year has been tough on many businesses. Inflation has been rampant, interest rates have been hiked in response, and global political instability has placed many on their toes.
In such instances, I like to remember some key wisdom Warren Buffett offered investors in 1986:
We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.
Market downturns often see otherwise high-quality shares trading below their true worth. While that might be disappointing for some, it's often brilliant news for those wishing to buy in at a decent price.
Over time, the market typically realises the true value of such a company, thereby bidding its share price higher.
And the cheaper an ASX investor can get on board such shares, the more they might stand to gain.
The market has always bounced back
That leads to my second point: The market has always historically bounced back from its lows.
Indeed, the broader market has already regained its 2022 losses – and then some.
The S&P/ASX 200 Index (ASX: XJO) is up 7.8% year to date while the benchmark All Ordinaries Index (ASX: XAO) has gained 8%. Though, whether it will hold onto the fruits of its January rally for the remainder of the year is yet to be seen.
But value investors need not despair. There are likely still plenty of bargains on the Aussie bourse.
Long-term growth prospects
Personally, I like the idea of a 10-year horizon when it comes to investing. Buying today's cheap ASX shares and holding them for 10 years could prove a winning strategy, in my opinion.
Lots will likely change over the coming decade. Indeed, we'll probably see a few bear markets and a number of bull markets in that time. Not to mention, fluctuations in inflation, sentiment, and political happenings.
By focusing on the future, however, I can relax knowing most market events are temporary, but high-quality, well-managed businesses typically continue to grow amid the ups and downs.
Thus, I believe that by buying quality ASX shares trading for cheap prices now, I can make the most of the coming years and reap the rewards of my investing fortitude in 2033. Or perhaps even further into the future.
