| |
| |
|
Investing Information |
|
|
|
How To Create Wealth In The Stock Market
First and foremost, an opportunistic strategy for creating wealth in the stock market is needed. And the opportunistic strategy for creating wealth in the stock market must have two ingredients, a plan and a goal. The plan must be a definite, concrete plan of investing that would profit you and your family for the rest of your lives. This opportunistic investment plan you begin should not profit anyone else - not a stockbroker, a mutual fund or a financial advisor. This means you have to have confidence in yourself and in your own judgment as to whether the investment plan you begin has merit. And this means that the investment plan would and should have already been proven to you! This definite, concrete plan you begin for creating wealth through opportunities in the stock market must also have a goal. The goal should be clear and specific, and once your have made up your mind to achieve that goal, then go forward and make that goal a reality. What are the opportunistic traits of a strategic investment plan built on concrete that would actually allow the shareholder to profit through all the turmoil of an up and down stock market? The secret for creating wealth in the stock market; no matter what direction the market is heading? As in what appears to be the most difficult investment question of all to answer, the answer lies in simplicity itself- investing in those companies that have a historical record of raising their dividend every year. Whether or not you can take this statement of fact to heart is your own judgment call. But it is this opportunistic trait that can and will create wealth for you and your family for the rest of your lives. A company's ability to raise its dividend every year, coupled with stock appreciation is a very powerful wealth creating formula! I'm going to provide you with two examples, though there are many more, some with even better results. The two examples are from my book, soon to be published by American Book Publishing - The Stockopoly Plan (where an investment plan and a goal are written in stone). The first example would be a stock purchased in 1990, Comerica (CMA). What led to the purchase of CMA? - In 1990 CMA had a 21 year history of raising their dividend every year. Today's CMA has a 35 year history of raising their dividend every year. This opportunistic trait in CMA stock has garnished a little better than a15 percent return a year, compounded annually (just by having the dividends reinvested back into the stock each quarter through those years - I prove this to you in The Stockopoly Plan), for the past 14 plus years. Today's CMA stock just recently touched a new high at $60 dollars a share, with a dividend yield of around 3˝ percent. In April of 2003 the stock was selling around $37.50 a share, paying a dividend yield of around 5% a year. Am I tempted to sell my position in CMA? Do I care if the stock drops from this lofty price back to $37 a share? Why should I? If the stock drops back to $37 a share, my dividends being reinvested back into the stock each quarter purchases more shares, and my dividend income from CMA simply and dramatically accelerates. I am also already prepared that if a buy-out offer is ever made for the company to reap the profits of owning the stock (as well as the possibility of another stock split). The second example is (unfortunately) in my book, also. I say unfortunately because my book is in the final copy edit stage, so no one has had a chance to read and benefit from it, and since a buy-out offer was made for the stock last week or so, the stock will no longer exist (this means a rewrite for me, before publication). The company in question is the Rouse Co. (RSE), which was just purchased by General Growth Properties (GGP). Oddly enough, you'll find GGP in my book, also - if you bother to pick it up. Anyway, that's neither here nor there - RSE, on the takeover bid jumped over $16.00 a share in one day! Whew! Why couldn't they have waited a couple of months until my book was released? RSE had the opportunistic trait of raising their dividend every year since 1993 and I was quite content with its performance through the years. Well, that last paragraph blew my train of thought on this article. All I can think about at the moment is my rewrite. I would like to take this time to explain something to you. I have never considered myself a writer nor am I a stock market professional. I am simply a man with 39 years of experience and a passion for the stock market, trying to share what wisdom those years have given me. When I sit down to write an article, I seldom have an idea on what I'm going to say. It was the same way when I sat down to write my book. I just meant to put down a few words on paper for my 18-year old son so he would have a sound, concrete plan for investing in those companies that make up the stock market (quite frankly - I didn't want him to blow his inheritance). Whether you find merit in what I say, I have no idea. What I do know is that life is just too short to learn everything you need to learn by yourself, without the help of others. There, now I'm satisfied with that ending! For more excerpts from the book 'The Stockopoly Plan' visit http://www.thestockopolyplan.com Charles M. O'Melia is an individual investor with almost 40 years of experience and passion for the stock market. Author of the book - The Stockopoly Plan-soon to be published by American Book Publishing
MORE RESOURCES:
Google News |
|
|
|
RELATED ARTICLES
Eight Questions to Ask Your Financial Advisor You may like your financial advisor, but is he really looking out for you? All advisors are not created equal, and you have a right to know what makes them different! You also have a right to ask yours if he compares!(1) Do you use a holistic approach to financial planning by determining my values and goals?(2) Do you work on a fee-only basis, a commission basis, or both, and why?(3) Do you have company-established insurance requirements, or do you recommend insurance only when it is needed by your clients?(4) Do you attempt to 'beat' the market through timing and selection, or do you believe that attempts to do so are not worth the additional level of fees and risk? Are you aware that a vast majority of my returns will be based on asset allocation, rather than timing and selection?(5) Are you a Registered Investment Advisor, and therefore a fiduciary? In other words, must you legally and ethically put my interests above your own?(6) Do you meet with your clients at least three times a year to refine their portfolio and find out how events in their lives may have changed their financial goals?(7) Do you return phone calls the same day you receive them, and are you available to answer questions as they arise?(8) When you wake up each morning, do you ask yourself how you can best be of help to your clients that day?Adjust these questions as you see fit, and depending upon what your own objectives and needs are from an advisor. The best advice is to never be afraid to ask!© 2004 Matthew S. The Economy Is Not The Stock Market Several days ago, the Commerce Department reported that May's factory orders had increased by a 2.9 percent. Wit and Wisdom on Money, Wall Street and Success - Part #2 Here are ten more WISDOM packed GEMS that ooffer very unqiue insights to the world of trading and investing.These quotes promote a philosophy which is readily understandable and sometimes hysterical. Trading Systems A trading system consists of a set of rules for viewing markets and making trades. The advantages of trading systems can be hidden when they become associated with trading platforms involving trade order submission and processing. Short Term Savings Products When you invest, it simply means that you are putting your funds in products, in this case short-term savings vehicles, which will allow you to reap high financial rewards.Here is a list of the more common short term savings products you should consider investing in. The Truth About Real Estate Investing - Is It Right For You? You have probably been hearing, seeing and reading that real estate investing is the best thing since sliced bread. There are many late night cable television infomercials spewing out sales pitches for courses that teach you how to buy residential real estate no money down or for next to nothing. Emotions: A Traders Worst Enemy; Get Rid of Fear and Greed - Youll be Glad You Did You hear it over and over and over in books, forums, and chatrooms. Fear and greed, fear and greed, fear and greed. Day Trading Strategy or Stock Trading Software? The Way You Pick Stocks Affects Your Results The trading method you employ to approach the stock market can make a big difference in your results.Stock trading is a very competitive field and in order to succeed you need to FOCUS on a set of simple strategies that you can implement without hesitation. Raising Capital in Today's "New Economy" We've helped a number of clients develop business plans and raise capital from "angel" investors, corporate entities and venture capitalists during the last 6-8 years. It's always a daunting process that can be full of pitfalls and require a tremendous amount of work - but it can be done! Here is some perspective gleaned from years of experience. DXPortfolio: A Great Passive Investment of 25% to $40% per month First, I need to explain about e-currencies or digital currencies. DXPortfolio are based and supported by the supply and demand of e-currency. Volatile Oil The Light Crude Continuous Contract fell from $67.70 a barrel on Monday to $62. Shop More, Save More for College Gimmick or Reality? The man sat in a chair beside a dressing room at a Tampa, Fla. maternity store. Pros & Cons of Investing in Bonds What are Bonds?A bond is a debt security, by which you are lending money to a government, municipality, corporation, federal agency or other entity known as the issuer. In return for investing in the bond, the issuer promises to pay you a specified rate of interest during the life of the bond and to repay the face value of the bond (the principal) when it becomes due. Investing Psychology Today Requires All Traders to Awaken Their Speculator Minds Stock trading strategies are as rampant today, as they were during the Great Bull Market. Yet, can you truly master the stock market like so many investing books propose?Consider this: When you can't even trust the financial reports of analysts, and the company bean counters that feed them with data, how can you? What's needed are robust, stock trading strategies; the type that enables you to think above the crowd, but not apart from them! The kind of strategies in touch with your speculator mind response!Witness the Enron fiasco. Going Offshore For Asset Protection There are a number of key reasons why individuals and businesses consider going offshore for asset protection purposes.The asset protection advantages the offshore world offers extend from protecting a business from excessive taxation to opening doors to enable wealth and asset enrichment via the utilisation of offshore investment opportunities. Is Starting A Business For Me? What To Consider Before Starting A Business Do you have the right temperament?Starting a small business is one of the most serious decisions that a person can take in life. Positively, it often results in higher income levels than one could achieve as an employee together with the unique buzz of being your own boss but conversely it also can be stressful, will demand longer working hours and will probably reduce your ability to take long holidays. The Past Does Not Equal The Future: Mutual Fund Returns! A way that investors get ripped off and in a sense rip themselves off is based on the culture of performance in the mutual fund industry. If you stop and think about it there is absolutely no reason that the past has to equal the future. Beginning Investor - Investment Terms Over the course of the past two months, readers have brought to my attention that there is a steep learning curve for investment terminology. That's why the focus of this month's Beginning Investor column will be investment terminology. Investing and Asset Allocation Sometimes you spend sleepless nights worrying about which stocks to buy and which to sell, which funds to own and which to dump and whether to get into bonds.All of these are legitimate concerns, but the greatest determinant of your success as an investor will not be your sagacity in selecting specific stocks, bonds or funds for your portfolio. What If You Absolutely Positively Could Not Lose - Would You Play the Stock Market? Seniors on fixed incomes face a unique problem. Where dothey invest their savings to get maximum return on investment with limited risk? Some of the traditional places like CDs and Treasury Notes are extremely safe, however the yields tend to be very low.
|
