. Do not spread your money that pay a dividend.
too thin.
The same company that you invest
My friend has a little over in commission free should also
$200,000 invested in the stock offer you another incentive for
market through 27 different you to invest - a dividend for
Mutual funds. In my opinion, 27 the use of your money.
Mutual funds is 27 too many
collecting load fees, management 4. Only purchase those companies
fees, commission fees, operating that have a history of raising
and advertising fees. their dividend every year.
Diversity is important, but just The same company should continue
as important is rewarding you for your faith in
over-diversification. Also, in my their company by increasing the
opinion, $200,000 should not be amount of their dividend every
put into more than 12 stocks, let year. Rising dividends are also
alone 27 different Mutual funds. the proof that the company is
doing something right.
2. Do not pay commission fees to
purchase a stock. 5. Dollar-cost average into each
stock position.
If you are going to invest your
hard earned dollars into a By dollar-cost averaging (buying
company, the least the company the same stock at different
could do is provide you a way to prices through the years) you'll
invest in their company never pay too much for the
commission free - and they do! company's stock, even if the
initial purchase is at a 52 week
3. Only purchase those companies high. Have all the dividends from
each company rolled back into lower, but your income from that
more shares of each company, lower priced portfolio would
until retirement. The companies increase dramatically. Profit by
you invest in should do this for income!
you, automatically, commission
free. 7. Make every stock purchase with
the intent that the purchase will
6. Forget making a profit; be a long-term investment.
instead focus on the income
provided from your stock Do not trade in and out of your
portfolio. holdings. There have been many up
and downs in the stock market.
That's right! Forget making a The down markets only accelerate
profit. The burden is now lifted your income. GE has raised their
- no more pressure on tryingto dividend for 28 years in a row.
make a buck in the stock market. Why sell it? 100 shares of GE ten
(Instead of trying to bend the years ago has turned into 1200
spoon, that is impossible, shares today due to stock splits,
instead just think of the spoonas and that is not counting how many
- omigosh! - I'm in the Matrix!) shares you would have now if the
When you focus on the amount of dividends were being rolled back
money your holdings are providing into more shares of the stock
in dividends - and when those through those years.
companies selected have a history
of raising their dividendseach 8. Understand that a lower stock
year - a lower stock price allows price, after your initial
the dividends that are being purchase may be a blessing in
rolled back into the stock to disguise.
accelerate your income. The total
value of your portfolio may go The income from your stock
holdings should grow every help your dividend reinvestments
quarter, no matter what the total to accumulate more shares on a
amount of your stock portfolio is dollar-cost averaging basis.
worth. (If your Mutual fund
declines in price from one year The savings could be as little as
to the next and if your income is $5.00 a week. Why put that
not increasing (accelerating) savings in a savings account at
from that fund, why are you in 1.2 percent, when there are so
that fund?) A company pays their many companies out there that are
dividend not on how much their paying a 4 to 5% dividend yield
stock is worth in the market and increasing their dividend
place. For example, a company every year? And since none of the
pays a quarterly dividend of 50 companies you are investing in
cents a share. A company has charge a commission, all of that
little control on how much its $60.00 a quarter you saved and
stock price is worth in the invested would help your dividend
market place on any given day. reinvestments to dollar-cost
You will receive 50 cents a share average into your holdings. Every
per quarter whether the stock cent you save and invest would
price is at 50 dollars a share, work toward your ROI (Return on
or drops to $40 a share or goes Investment).
up to $70. While the stock is
down at $40 a share your dividend To read the PREFACE from the book
reinvestment is loading up on ‘The Stockopoly Plan' please
more shares. visit
http://www.thestockopolyplan.com
9. Develop a savings plan to add
to your holdings each quarter to
About the Author:
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. To invest in a copy of the book: http://www.pdbookstore.com/comfiles/pages/CharlesMOMelia.shtml
Source: www.isnare.com
