I am up over 35% by day trading in the past 6 months. This works for me for now. I am slowly moving into dividend stocks but keeping a healthy cash reserve to pounce on undervalued companies as earnings come out. Example, MU last week…
Hey, we are all looking for “safe” investments that return 10% or more each year!!! When you find them, let us know!!!
That being said, you aren’t going to find anything like that. It’s too good to be true. The higher the risk, the higher the reward. Even the top “high interest” savings accounts are only offering like 1.25-1.5%, etc.
I’ve been searching myself, and there doesn’t seem to be really any good place to put your money right now. The stock market will likely correct at some point over the next 6-12 months which is a risk to you. And if you leave it in cash, then you are due for inflation eroding the power of your dollar. Gold could go either way at this point. It’s received too much appreciation and too much attention lately (usually when everyone does it, it’s time to get out) and is at historic highs.
99% of my investments are done through my 401K, so I have a much longer timeline than you do. I can wait as long as it takes. That being said, I’m trying to buy beaten down stocks in out of favor industries or stocks that pay solid dividends. There are several stocks that you could get that juicy 10% dividend from, but you never know if the price of the stock itself corrects over the course of the year and then when you are ready to sell, you might be down as well…
I think that common wisdom says that any money that you will need in the next 5 years should not be in the stock market.
This is what Madoff did.
Five to 10% return, from a safe vehicle, in 2010?
Interest rates (Fed, LIBOR)are negligible now. You can use on on-line (no bricks and mortar) bank such as ING to boost conventional account interest. You’re talking HIGH YIELD and with that comes risk. No one wants to “borrow” your money to invest themselves at your requested return. They can find funds much cheaper elsewhere. The only folks offering high yield are those who’s risks are too high for conventional sources of capital.
Those hoped-for returns will require speculation which diminishes the safety of preserving your capital.
Hey let the rest of us know if you find it.
Final unsolicited advice (from a person you don’t know, on a fishing website): invest in yourself. You’ll nearly always achieve more wealth through your career and income than you will investing a small fraction of it.
While there is some risk, buying certain stocks for their dividends certainly beats holding it in a cd. At&T and Duke both offer decent
dividends, at minimal risk (IMO). I still try to buy on dips, and sell when I have a nice profit(Duke tends to be cyclical), but its the dividend I’m after for the long run.
Good Point Mandopickr. I can’t believe I forgot the blue chips.
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Even Blue Chips don’t seem to meet your risk profile. They go up and down as well. They are usually very tightly correlated with the movement of the overall market as well. You can’t assume that your money will be “safe” there if you need to cash out in one year as you indicate. In the long haul, IF you get them at a good price, they may perform well, but if you pay too much, you can lose money too!
quote:
Originally posted by MandopickrWhile there is some risk, buying certain stocks for their dividends certainly beats holding it in a cd. At&T and Duke both offer decent
dividends, at minimal risk (IMO). I still try to buy on dips, and sell when I have a nice profit(Duke tends to be cyclical), but its the dividend I’m after for the long run.
Duke is going to suck for at least 5 years and ATT for at least 10. The flop is on the table for those companies already, their earnings for the next 5 years is already known.
Google instead of ATT and don’t touch the energy sector, all the profits in energy will be taken before the small timers see a dime, and that’s a best case scenario.
Hold the tomato, fool!
???
Duke pays a yrly dividend of .96 for a $16 stock.
Att pays yrly dividend of 1.68 for a $25 stock.
Google pays nothing on a $550 stock.
For the equivalent of a 100 share investment in Google
I would own 3437 shares of Duke and would make $3300 a yr div.
or own 2200 shares of T, and would make a yrly div of $3696,
without any consideration of share appreciation.
I’m not saying Google is not a good investment, though it is still $150 off its high of $702. I know very little about it, other than what I hear on tv, and I don’t consider that information a replacement for investment research. However Google is a totally different type of investment from dividends stocks.
Since the fall of 2008 as most of the stock market contracted, holding dividend paying stocks was pretty nice.
I’m with Mandopickr on this one. Although Google isn’t going anywhere, you have to ask yourself if you are getting it at a good price. They carry a 176B market cap right now at 27 times earnings with no dividend. Take an established tech blue chip like MSFT that pays a dividend and still only trades at about 15.6 times earnings which is probably about right. If google cannot sustain explosive growth, then the stock will eventually sink to match fair value. If you look back at the history of the MSFT stock price, you will understand the painful transition for a shareholder as they hold a stock that transitions from a growth company to a blue chip.
Energy prices will only rise. Essentially you would invest in Google if you still expect strong innovation and market adoption over the next 5 years, which is questionable in this economy. You would invest in Duke if you want some protection against inflation and rising energy prices, and hope that they start raising their dividend. One thing is for sure. People will give up their internet and android phones before they give up power to their house. This economy isn’t out of the woods yet!
Dang, I forgot about MSFT. Need to add it to my watchlist.
That’s why I like this thread.
Yeah, I just made that stuff up off the top of my head.
However, there is much more room for Google to grow, they are getting into the infrastructure business, and they’ve got the cash to do it. That’s bad for ATT. Google might buy ATT as part of getting into that business. Google is still an infant. 5:1 split and it will still be a $500 stock. They don’t pay dividends because they don’t have to. If you want dividends, I agree with your assessment. If you want growth, I think you’d be a fool to buy MSFT over Google.
Hold the tomato, fool!
I’m not suggesting MSFT over GOOG. I’m just saying that most big tech companies are priced around 15 times earnings. If GOOG were priced the same, it would be around $310 per share. I too beleive that GOOG has a lot of room to run (as a company), but it ain’t exactly a “small cap” at this point. The bigger a company gets, the harder it is to grow earnings by 50% each year. Right now, GOOG already has a 100% growth in earnings priced into the stock price!!! The market is irrational for as long as it will be irrational, but the trend won’t last forever. Again, GOOG is a great company, but I just think that it’s a little over-priced at the moment. As far as MSFT, I think it’s a “fair value” price… But, what you really want is a DISCOUNT!!!
Remember, finding great companies is the EASY part of investing… Getting them at a good price is the tricky part!
look at Apple stock fellas, no dividends whatsoever but look at their financials and you will be very impressed
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I’d rather be a conservative nut-job than a liberal with no nuts and no job!!
Once you own the blue chip stock, you can also write a COVERED CALL and collect $$$ up front for the contract. In a stagnant or bear market, you won’t have to deliver the stocks but can keep the up front $$$ for the contract PLUS any dividend during the contract period.
“The problem with socialism is that eventually you run out of other peoples money”
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