Investing 102

[GregWeld]

Originally Posted by Coursey

I found a recap on page 76, is this the one you were talking about? or is there a differnet one as well?

Yep that's it..... but even go back to page one and just cruise thru there because there's been a ton of questions and responses... and examples etc

[GregWeld]

This is OLD NEWS -- from the SEPTEMBER QUARTER -- but what I want to ask you is.... did anyone get a 15% pay increase last year - or this year?

Here's your lowly McDonalds giving you a 15% pay increase... and this is another aspect that you want to look for in dividend payers.... the DIVIDEND INCREASE over time. Because this means they're making money - and it covers you for inflation!

I am NOT pushing McDonalds - it just happens to be a stock I own so I can use it as an example.

++++++++++++++++++++++++++++++++

McDonald's Corporation announced that its Board of Directors declared a quarterly cash dividend of $0.70 per share of common stock payable on December 15, 2011 to shareholders of record at the close of business on December 1, 2011 . This represents a 15% increase over the Company's previous quarterly dividend rate and brings the fourth quarter dividend payout to over $700 million.

[Taylor1969]

Greg - FANTASTIC THREAD... and just at the right time.

31yo who wants to build a future.

I have 20K in my account ready to invest. This morning i bought my first ($1000 in T)

So, with 19K remaining what do you think about 2K in each of the the following to start:

MCD
GSK
COST
MMM
KO

What do I do with the rest? Anything I should add in to balance things out? BTW - I have an energy stock through a DSPP and options at work.

By the way - if I have the ability to self direct my 401K, should i follow the exact same principles there?

Thanks!
Chris

[hifi875]

im thinking of dropping 10 in annaly. bought some other stocks the other day.

at&t
bank of america
starbucks
altria

the dividend stream alone on annaly can really add up!!

[GregWeld]

Originally Posted by Taylor1969

Greg - FANTASTIC THREAD... and just at the right time.

31yo who wants to build a future.

I have 20K in my account ready to invest. This morning i bought my first ($1000 in T)

So, with 19K remaining what do you think about 2K in each of the the following to start:

MCD
GSK
COST
MMM
KO

What do I do with the rest? Anything I should add in to balance things out? BTW - I have an energy stock through a DSPP and options at work.

By the way - if I have the ability to self direct my 401K, should i follow the exact same principles there?

Thanks!
Chris

Chris....

Somehow you missed the "GREAT CHART" part of the research...

Go back and look at 3M (MMM) and Glaxo Smith Kline (GSK)... these are not the growth story you need. So what I would do is to look at your choice -- and compare them against other companies in their sector. You really want to TRY to get all of the major components in your picks -- Growth - Dividend - good chart - name/business you understand.

I also think that with 20K to invest - I'd prefer you get more diversity. So even if you just went with 1250 or 1500 per name and spread out a bit more.

You have Coke - McDonalds and Costco.... All good stocks -- but with the size of your account - and your age - I'd try to get some separation. These 3 horsemen are basically in the same 'sector'.... food/retail.

That, and you don't have any higher risk stocks to balance out your steady eddies. Your age allows you to take a little more risk than what you've chosen... and they can really put some octane in your total returns.

So with 20 grand --

choose Coke or McDonalds

Pick a different drug company -- with a better growth story that GSK or at least compare them and see if there is one you'd be just as happy with. You may end up with GSK if it's the one you like.

Ditto this in 3M

I like Costco --- I don't own any -- but it has a growth story and is a really well run company. I just would like to see you have more diversification.

Let's take a look at adding a high yielder -- JNK or HYG or NLY or some other in that category.

Great that you have energy already -- the country is always going to need energy!

Yes I'd follow the same strategy in your 401... You need all the horsepower you can to get you to win the race. You're young. You have time. So treat your 401 and your "new" account as ONE BALANCE -- add them up -- look at them TOGETHER - don't duplicate and don't overlap. IT'S ALL YOUR MONEY -- so diversify and think of them as ONE account when looking at them.

Remember --- I'm (nor anyone else) is here to pick stocks for anyone... We're really discussing what to think about and how to look at them.. so please don't feel I'm dissing your choices... you're on the right track but let's look a little more and then post up what you're thinking... and maybe where you're at in the 401 (names so we can look at it all - and feel free to use PM if you're not comfortable posting this stuff publicly).

[hifi875]

I look at my 401k and see what little its doing and think i could just do my own mutual fund like greg said and come out the same or even better. Its really got me thinking about my money instead of my car to a certain extent. scarry!!

[GregWeld]

Originally Posted by hifi875

I look at my 401k and see what little its doing and think i could just do my own mutual fund like greg said and come out the same or even better. Its really got me thinking about my money instead of my car to a certain extent. scarry!!

THE MONEY PAYS FOR YOUR CAR!

You'll feel better about putting money into your toys -- when you have REAL MONEY being earned and saved (not home equity rising - that don't count).

Just be mindful of INTEREST RATES when you're investing in Annaly (NLY) or HYG or JNK.... because these invest in interest rate sensitive product... and as interest rates RISE you'll take a hit in the capital side...

I use these to PARK money and get a great return -- so think about it this way -- you can have money in a money market account and make .025% --- or you can park money in JNK - HYG - NLY and make 7 to 12%... but you have to be ready to move. They are not "park it and forget it" names.

Since the FED has said it's leaving rates LOW.... we're looking good here - but be ready if the FED SIGNALS it's changing it's mood! Then you SELL these names quick!

[Coursey]

Right now all really have is a high yield checking account and a 401k through work.

My checking account makes 3.54% daily for the first 20K. Over 20K the interest is incurred at .75%. This is were the bulk of my money is setting.

Im not really sure what all my Edward Jones account has in it. I am going to try to get a better hold on this account to see how it is doing, and what funds it is in (I think it is AmeriFunds).

This thread has really got me thinking about were my money is at and if it would betterin other places.

[Bucketlist2012]

So much activity and questions..

I am loving it..

Yes, the Investments now will pay for your toys later..

We are at a crazy time in History.. The last few years, and the next few years.. Incredible opportunities.. Take them..

We sure will have big bumps in the road(Market), but in the long Run, those that are in the game now with multiple "employees", will reap the benefits later, and the dividends along the way.

Can I vote that Big Ben speaks every week...Because when he does....

[hifi875]

Originally Posted by GregWeld

THE MONEY PAYS FOR YOUR CAR!

You'll feel better about putting money into your toys -- when you have REAL MONEY being earned and saved (not home equity rising - that don't count).

Just be mindful of INTEREST RATES when you're investing in Annaly (NLY) or HYG or JNK.... because these invest in interest rate sensitive product... and as interest rates RISE you'll take a hit in the capital side...

I use these to PARK money and get a great return -- so think about it this way -- you can have money in a money market account and make .025% --- or you can park money in JNK - HYG - NLY and make 7 to 12%... but you have to be ready to move. They are not "park it and forget it" names.

Since the FED has said it's leaving rates LOW.... we're looking good here - but be ready if the FED SIGNALS it's changing it's mood! Then you SELL these names quick!

One good thing about this thread is that it has legs. I don't think it will just end, because its something like cars that we all have in common. Its just another part of the car hobby(funding it to a lesser degree sorta). It might even pass vegas69 build thread one of these days! I know I check it daily. thanks for getting it going and keeping it going.

mike