| |
| |
|
|
Stocks and Mutual Funds |
|
Investing in Dividend Paying Stocks
I was recently interviewed for a press release through a financial question and answer format. One of the questions asked of me in the interview was: Where do you think the stock market is headed over the next five years? My Answer! Charles M. O'Melia: No one knows! There is an old Chinese proverb that goes something like this: "He, who could foresee events 3 days in advance, would be rich for thousands of years." On a long-term basis I have only witnessed expansion and progress. I believe that to be the nature of our American economy and our American way of life. And as our economy goes, so goes the stock market and I see no reason to change that belief. Who would have thought the expansion in China would generate 5 billion dollars of business for GE? The US companies listed on the New York stock exchange have the ability to profit throughout the global expansion of business around the world. And, an investor can profit without the necessity of having to own an overseas fund or companies to profit. Up until that question, the thought of what the market was going to do tomorrow (or for that matter, 5 years from now) have never concerned me. I never gave it a thought (Well, maybe a little!). There just isn't enough concern on my part whether we are heading for a bear market or a bull market, or if the markets are heading sideways. When you own a portfolio filled with companies that have a history of raising their dividend every year, and a systematic approach of adding more shares to the portfolio through the dividend reinvestments every quarter, plus having a simple savings plan with an opportunistic buying approach of adding even more shares to the portfolio every quarter, it really doesn't matter. I am always buying more shares. Sometimes I pay too much for one of my companies; sometimes I receive a great bargain. But no matter which, bargain or expensive, my income from those companies always continues to grow and grow and grow and grow and grow. Sometimes, the dividend yield of one stock may be 5.15%, and the following year or two (even with two dividend increases during those two years) the dividend yield would drop to less than 3%. This, for example, may mean the stock price would have risen from the 30 dollar range to the 60 dollar range. I have found that when that 5.15% dividend yield drops to around 1%, the company's stock in question becomes so high that the company usually has a stock split, as well as a dividend increase. Right now, the DOW seems to be having trouble breaking that 11,000 barrier. And, right now, I can't help thinking back, way, way, back. For those of you who don't remember the late 1960's, early 70's, the DOW barrier was 1,000. Oh, what a tough time that DOW 1,000 barrier was! I remember thinking - it's going to break it this time. Back in 1966 was the first attempt (rose to 985) and it kept on trying to break the 1,000 barrier for the next 6 years. When it finally broke 1,000 (it reached 1,050 or so, in 1972), it immediately fell back. It took another 10 years before the DOW broke the 1,100 barrier. Six years for the DOW at 985 to break 1,000. Another 10 years to break 1,100. A total of 16 years to add a mere 115 points on the DOW. So, is the 11,000 barrier in the DOW today similar to the 1100 barrier of times-gone-by? Will 11,000 on the DOW become a 16 year barrier? Could be! Then again, maybe not! I don't know! "He, who could foresee events etc." In the meantime, I will continue watching my dividend income continue to grow and grow and grow and grow and grow! To find the LINK for the complete financial interview visit: http://www.thestockopolyplan.com You have permission to this article either electronically or in print as long as the author bylines are included, with a live link and the article is not changed in any way. Please provide a courtesy emailto: charles@thestockopolyplan.com telling where the article was published. (Word Count 706) Charles M. O'Melia is an individual investor with almost 40 years of experience and passion for the stock market. The author of the book 'The Stockopoly Plan - Investing for Retirement'; published by American-Book Publishing. The book can be purchased at http://www.pdbookstore.com/comfiles/pages/CharlesMOMelia.shtml
MORE RESOURCES:
Stocks-Mutual-Funds - Google News |
|
|
|
RELATED ARTICLES
Pathways During our travel down life's path we come to many places where the trail divides and we must make a decision. Some involve psychological (emotional) choices - marriage, divorce, leaving home, career changes, etc. Making a Stock Watch List I am taking the time to help others learn the basics in evaluating stocks for investment using both fundamental and technical analysis. Both tools are equally important in making serious decisions with your hard earned CASH!If you wish to invest in stocks, treat it like a business, NOT A HOBBY. On Line Stock Trading: Small Cap & Micro Stocks Go Up and Down - How Can You Profit? Success in small cap & micro cap stock trading like with any other business in life comes from being able to see the big picture and from paying attention to the small details.Let's say for example that you are a business owner and you have a jewelry store on a given street just like the guy in the other corner does, but still the other guy is making 5 times more profits than you are only because he's doing something different. Eternal Sunshine There is a current movie entitled "Eternal Sunshine of the Spotless Mind". It is about a man who has had a painful love affair and will do anything to rid his mind of those pain thoughts of a former love. Two for the Money Look back over the years and try to remember how many different stocks and mutual funds you have owned. Suppose you had owned only 2 different equities during that entire time. Perfect Storm Having lived aboard a sailboat for 2 years I was stricken when I saw the movie "PERFECT STORM". I know these are things you want to avoid at all costs. Analyst Reports When you become interested in a stock or mutual fund you can call your broker and he will send you reports on how the company is doing, what their management is like and what might be the projected earnings for the company and how the industry is doing. Great information. Hold Em and Fold Em When most analysts, financial planners, fund specialists and investors try to decide whether to buy a particular stock they immediately go to the financial statements to determine the growth potential of the company. Numbers and more numbers. Stock Market Investments If there is one term over-used when talking about making investments in the stock market I would think that term would be: buy low, sell high.Buy low? Sell high? How low is low and how high is high? I like the term buy low, sell dear, much better! But better still are the terms buy and hold, and dollar-cost-averaging (buying the same stock at different prices through the years). E-mini Day Trading - Day Trading for Beginners - Stock Market Timing Software I mean it when I say that. While plastic silverware is fine for picnics and parties, it is totally inappropriate in a surgeon's hand with an open brain in front of him. Bargain Basement - Finding Stocks That Go Up Have you been listening to the talking heads on CNBC-TV? Or those talk radio stock experts? Getting all those good recommendations on what to buy now. Now?Those guys keep telling me the market is oversold. Dividend Paying Stocks I would like to share with the reader an article printed in the financial section of U.S. The I Word is Coming to a Town Near You Hello Inflation, it has been awhile, I see you on your way back again. Inflation? What inflation? Oh things like; Energy, diesel fuel, Aviation Fuel, Gasoline, Natural Gas, Milk, Wheat, Corn, Beef, Poultry, Hogs, Soy Beans, Building materials, paper, housing, Auto Prices, Health Care, Insurance, etc. It Cant Be Done Wouldn't it be nice if you were only in the stock market when it was going up and have everything transferred to cash while it is going down? It is called 'market timing' and your broker or financial planner will tell you "it can't be done". What that person just told you is he doesn't know how to do it. The Club Yesterday I received my monthly issue of MONEY magazine. This issue has the special feature called "The Ultimate Investment Club" that highlights their picks for the top mutual fund managers. Market Success Who are the successful investors?There are those who follow the advice of their brokers and financial planners or those who choose to use their own good judgment? If you care to compare the results of the past 4 years from 2000 to now I believe you will see who as done the best job.In the old days at the Chicago stock yards they used to have an old sheep who led the lambs to the slaughter when they arrived on the train. Investing Basics - Stocks, Mutual Funds, Real Estate & Online Investing Have you ever thought of investing? Do you have a family that you would like take care of? Does the idea of making money with stocks, bonds, mutual funds and real estate interest you?Investing is essential to making money. Whether it be stock investing, investing online, real estate investing, finance investing, investing in bonds, investing in mutual funds. How to Find Value in No Load Mutual Fund Investing What are you thinking when it comes to your no load mutual fund selections? Are you saving pennies and sacrificing dollars?Are you spending your time looking at expense ratios, analyzing Morningstar ratings and searching for funds with low fees and no 12b1 charges? If you are like most people, you know these things in and out. You've spent hours evaluating them, and your chosen mutual funds cost little to purchase and maintain. Emotional Maturity If you are going to be a winner in the stock market you must have emotional maturity. I did not say you had to be smart or know how to pick stocks and mutual funds. Whos Calling? Its dinnertime and the phone rings. It's Joe Noname with SuchNSuch Investment Company and has he got a deal for you.
|
||||||||||||||