Investing 102

[GregWeld]

For those of you that own Altria (MO) or Philip Morris (PM).... or both (as I do) do you now understand why you own stocks like this? This is a rhetorical question... but what I'm asking is whether or not you understand - now - owning stocks that hold up in poopie or scary markets... Sometimes the stuff you think is boring as all get out... can be your best investment.

Just sayin'

[WSSix]

x2 My MO, CLX, and KMB have done well for me. JNJ has dropped but it still pays a nice dividend, and I know it will come back up eventually. I like boring when it comes to money typically.

[toy71camaro]

VERY happy MO holder over here.

[GregWeld]

Originally Posted by toy71camaro

VERY happy MO holder over here.

It's always funny to me that everyone wants to own the "hot stock" -- obviously -- this thread has always been about investing and growing your money over time - it's about not being worried every day about what your shares are doing... it's about peace of mind and capital growth (as well as preservation in troubled times). It has never been about stock recommendations or what to buy - it's been about how to buy and what are some simple things to think about. Altria (MO) is just an example of one stock used in this thread... and it fits the bill for most of the things we discuss time and again - so it's a good example.

Here's another good look at WHY we use these as examples....



Altria (MO) has a Year-to-date gain of 20% - a One year gain of 29.79% and a 5 year gain of 138%

Pretty impressive for a stock that's never in the news - and nobody ever talks about owing it.

Let's compare it to the ones everyone talks about and that are in the news daily.

Yahoo (YHOO) - YTD DOWN 33.5% - One year Down 12.6% - Five year UP 106%

Let's look at that -- so if you were in 5 years ago - even if the stock were DOWN this year - you're still way ahead... but man what a scary ride along the way -- and zero dividend....

Twitter (TWTR) - YTD down 13.5% - One year down 36% - Five year down 25.5%

It WAS THE HOT STOCK that was going to make everyone rich!

GoPro (GPRO) - YTD down 54% - One year down 61% - Five year (wasn't around) but the chart shows down 19% since it's IPO

This was the OTHER "get rich quick stock"

Not sure about you guys -- but I'd prefer to own boring old MO... over GoPro. LOL

[CRCRFT78]

I bought 10 shares of GoPro early on and watched it jump up to $90+. I knew it wouldn't continue to climb but I surely didn't expect it to nosedive either. Lucky for me its in a Schwab account with money I can afford to gamble with. I will just continue to hold on for the ride and see what happens.

[GregWeld]

Originally Posted by CRCRFT78

I bought 10 shares of GoPro early on and watched it jump up to $90+. I knew it wouldn't continue to climb but I surely didn't expect it to nosedive either. Lucky for me its in a Schwab account with money I can afford to gamble with. I will just continue to hold on for the ride and see what happens.

I've bought and sold all of these - sometimes making some money and sometimes losing some. There's nothing wrong with buying these kinds of names ----- PROVIDED ---- you understand what you're doing and you have a good base of normal investments etc.

[CRCRFT78]

There's nothing wrong with buying these kinds of names ----- PROVIDED ---- you understand what you're doing and you have a good base of normal investments etc.

That is why I bought it with money I could afford to lose. If I gain something, GREAT, if not, no big deal. I wouldn't have added it to my retirement account. On another note, I did add T (AT&T) to the retirement portfolio.

[Vegas69]

I'm a fan of MO as it's one of my best. I can't stand AT&T. They have lied to me way to many times. The leadership is horrible. I own some stock but it would be the first to go if I was selling.

[GregWeld]

So once again we're back to "fundamental changes" in a business.... Here comes McDonalds (MCD) which had been just dripping down and down and reporting sales disappointments quarter after quarter... They changed the CEO... Made a big change to "breakfast all day" and BAM! Finally a big quarterly turnaround and the stock jumps $7

This is the thing when big companies make big changes... you just won't know which way that's going to play out.

[ironworks]

Originally Posted by GregWeld

So once again we're back to "fundamental changes" in a business.... Here comes McDonalds (MCD) which had been just dripping down and down and reporting sales disappointments quarter after quarter... They changed the CEO... Made a big change to "breakfast all day" and BAM! Finally a big quarterly turnaround and the stock jumps $7

This is the thing when big companies make big changes... you just won't know which way that's going to play out.

So using the Mcdonalds idea. How does a guy look at this stock now?

Obviously the best position would have been to believe in the new CEO and buy when the stock was at its lowest or some where near there.

Seems to me like a band wagon move to get on board now. But a 3% dividend is decent.

I think MCD is big enough they will change there game to make money. But in tens years the Big Mac might be outlawed or totally changed. I don't think MCD will go under and I'm glad to see they try some big changes, which Jack in the Box did years ago.

Just wondering you mindset looking at this situation to use in others.