Investing 102

[WSSix]

I've had a number of stocks do just that to me as well. The fun part is that I haven't lost a dime on any of my investments. Granted, I have only made a few dollars on a couple of them but those dividend payments are what made up for any drop in share prices. Fun times.

[GregWeld]

Originally Posted by WSSix

I've had a number of stocks do just that to me as well. The fun part is that I haven't lost a dime on any of my investments. Granted, I have only made a few dollars on a couple of them but those dividend payments are what made up for any drop in share prices. Fun times.

The beauty of the dividend.


I remember one poster here questioning whether or not "dividend investing" was just trendy --- or posted that perhaps it was even in a bubble....


I don't understand what's trendy about actually EARNING MONEY on your investments. SMH


A bubble is another question all together. That would happen if so many people bid up the prices of dividend stocks that they were paying unusually low dividend percentages vs the "market" rate on other investments. I'm positive that AT&T (T) paying 5% isn't out of line with other marketable investments - so I don't see any bubble forming in what I own..... LOL

[GregWeld]

Since I mentioned AT&T (T) ----- which is a name I own some 40,000 shares of.... *that's called full disclosure*



It reported earnings yesterday. The earnings were "fine" - a small beat on top line - good subscriber growth... but this is a very large company with lots of competition. I don't own it for a big surge of growth. I own it because I feel safe investing my money in that name and they pay a pretty decent dividend.

The Investing 102 post is about paying attention to the ups and downs....


T is UP about a buck in the last 5 days. That's typical of many stocks that get bid up BEFORE earnings reports. It's called buying the rumor. Then many times - a guy would think -- GREAT!! My blah blah company just beat the whisper number and we're going higher from here.... and POP! Somebody pops your excitement... because the stock sells off! WTF is with that! That's called "selling the news". So there was a run up of expectation.... and then profit taking.

I used to try to TRADE like that. Making 50 cents here and there. Constantly trying to game the news. Getting ahead of the news and then getting out.

Here's the point --- I think T will trade off a buck today.... and years ago that would have freaked me out.. but I'm smarter than that now - and I go see (check a chart) that GEE! The stock ran up a buck just last week.... So it's not OFF a dollar so much as it is just trading where it was a mere week ago.

[SSLance]

T is currently off 3.2% today...dragging VZ down 1.6% with it.

I'm trying to decide now which one to buy more of on the dip.

[MX145]

I'm hooked! I don't know what I'm doing and have anything to share but I read this thread every morning. It's become the first thing I read for the day.

[96z28ss]

So Apple just announced a 7 to 1 split, to take place in June.
The stock just jumped $40 after hours.

[CamaroMike]

While it was a big jump, thats the price they were at back in January, ive been watching it too but im not a owner. Its been too expensive. I wonder if Forrest Gump still owns it

[GregWeld]

Originally Posted by MX145

I'm hooked! I don't know what I'm doing and have anything to share but I read this thread every morning. It's become the first thing I read for the day.

That's funny -- good funny.... Investing is addicting -- and way more fun down the road.

Originally Posted by 96z28ss

So Apple just announced a 7 to 1 split, to take place in June.
The stock just jumped $40 after hours.

It is a move to make the shares more "affordable" --- but Microsoft did this (many many times) ---- and what that did was to give MSFT the largest "float" (the most shares issued) of any publicly traded company. Eventually that made it so that even if there were buyers -- there was so much stock out there that it wouldn't go up. Nobody was/is capable of bidding it up. Well -- that and Billy G - is selling 100's of millions monthly. When you have a seller just pounding the stock into the ground month after month.... it's hard to lift it.


I don't think Apple is there yet --- but there will now be 7 times more shares out there.


And I think CHINA is the big grower for them. Remember there's 3 times as many people there.... so that's a very big market.


Here's the INVESTING 102 takeaway.... don't CHASE a stock up. If you want to own a name --- watch it.... there will be an opening to let you in. Don't rush to buy on the excitement day. Let the great news settle a bit... and wait for a big MARKET down day that creates an opportunity for you. That might not ever come by the way... Some times these things just keep going to the moon... but usually things settle down a bit.

RETAIL investors (us) rush to get in --- they buy on the big hype.... while the news is hot. Don't be that guy. Mark your buys -- wait and watch and buy (nibble) away when opportunity opens up.

Originally Posted by CamaroMike

While it was a big jump, thats the price they were at back in January, ive been watching it too but im not a owner. Its been too expensive. I wonder if Forrest Gump still owns it

EXACTLY. Go to the charts and there's been many opportunities to buy well below the high prices.

This doesn't pay much dividend -- it's all about GROWTH. Having said that --- I do think they're a grower and that's mostly because of China.

[GregWeld]

Here's something about Apple (AAPL) I wasn't aware of.... apparently part of the 7:1 stock split (which means for every one share you own - you'll get 7 - and the price will be DIVIDED by 7)... is that they didn't have enough "float" (number of shares issued) to be included in the DOW. With the split - that removes that barrier.

THAT is a very big deal - because it means that every ETF or Mutual Fund MUST buy the shares if their "fund" is based off tracking the DOW. MANY MANY companies mirror the DOW. So typically once a company gets included in the DOW --- there is a lot of pent up buying demand.

Now -- the INVESTING 102 takeaway --- buying just based on something like that -- is GAMBLING -- it's not INVESTING. If you want to own the company make certain that you're buying it because LONG TERM it's a company that you want to own.... DO NOT buy because you THINK you're going to get a big pop. When you buy like that -- the pop doesn't happen -- the stock disappoints - and YOU LOSE MONEY. Don't fall into that line of thinking because it's a scenario that sets you up for failure. You'll be right one in ten times.... that's not good odds and isn't how you get fat financially. If you're rich already -- and have money you can afford to throw around - then maybe you can afford to do that.... but that's not smart money.

[CamaroMike]

Duly noted.