If there is one term over-used when talking about making investments in the stock market I would think that term would be: buy low, sell high.
Buy low? Sell high? How low is low and how high is high? I like the term buy low, sell dear, much better! But better still are the terms buy and hold, and dollar-cost-averaging (buying the same stock at different prices through the years). For within those two stock market terms, in my opinion, lies the path for successful stock market investments.
For me, if a buy and hold strategy is used, then I want to be paid for using it, and if a dollar-cost-averaging strategy is used, I don't want to be charged commission fees for the future dollar-cost-averaging purchases.
Therefore, in order to be paid for the buy and hold strategy the companies purchased must pay me every 3 months. If a company cannot pay me every 3 months for buying and holding their stock, then I don't want to buy and hold their stock. The payment is called a dividend, and the dividend varies with each buy and hold company owned. This buy and hold strategy co-exist with dollar-cost-averaging. The monies paid by the company every quarter through the buy and hold strategy is used to purchase more shares of their company. The company does this commission-free, and is automatic every quarter through the years of ownership.
The brokerage houses of today, to compete with most dividend paying companies, now offer the same commission-free service when having dividends rolled back into a company's stock. Only you are going to have to tell them you want the dividends rolled back into the stock (sometimes you have to tell them twice, since it is not one of their high priorities; after all, they are in the commission business).
To read the PREFACE from the book 'The Stockopoly Plan - Investing for Retirement.' Visit: www.thestockopolyplan.com
Charles M. O'Melia is an individual investor with almost 40 years of experience and passion for the stock market. The author of the book The Stockopoly Plan ? Investing for Retirement; published by American-Book Publishing. You can invest in the book at www.thestockopolyplan.com
You have permission to publish this article either electronically or in print, free of charge, as long as the author bylines are included. A courtesy copy of your publication would be appreciated. Please email to mailto:charles@thestockopolyplan.com
tidy up service Glenview ..Ever wondered what is a mutual fund? A mutual fund... Read More
Before they go over the cliff to their destruction these... Read More
04/28/2005NASDAQ dropped -12.5% year to date in 2005. S&P500 index... Read More
If you are fed up with early redemption charges and... Read More
"If you don't know where you are going, any road... Read More
On Monday, November 25, 2000 Investor's Business Daily listed on... Read More
Just 30 years ago the stock market was a shadow... Read More
One of the big advertising kicks today from mutual funds... Read More
Several times each month I am solicited by various market... Read More
A PEG ratio cannot be used alone but is a... Read More
People are always asking me when should I sell my... Read More
When is a dividend not a dividend?The latest thing "conservative"... Read More
How do you make money without picking tops and bottoms?I... Read More
I have watched my cat play with a bag of... Read More
Let's discuss commodities; with the latest Enron situation, it is... Read More
Two weeks ago I wrote about what the Securities and... Read More
Today's society gives special recognition to alcoholics, sexaholics, binge-aholics, shopaholics,... Read More
Suppose your position has made a big move and you... Read More
Everyone who follows the financial news has heard of mutual... Read More
We need a rabbit!This was a pretty horrible week for... Read More
The Surgeon General of the United States says that smoking... Read More
Let's say you are interested in this one company. You... Read More
Ever turn down a street, get half way and suddenly... Read More
I often play a little game with myself when I... Read More
In one of my previous articles (Investing in the stock... Read More
maid service near Winnetka ..Just about now everyone is confused as to which way... Read More
Invest in the stock market for the RIGHT reason, using... Read More
Everybody is riding the Wall Street Roller coaster. Even if... Read More
The big bad bear is stirring again. So far he... Read More
In 1960 an engineer working for a watch company in... Read More
Let me start by saying that...Most online brokers do not... Read More
Exchange Traded Funds (ETFs) are a group of passive index... Read More
Every year I go to the Money Show in Orlando,... Read More
If there is one term over-used when talking about making... Read More
There are formulas for just about everything, but it has... Read More
Investors who exclusively use broadly diversified, no load mutual funds... Read More
If you're a normal human being, your need to feel... Read More
∙ Make every investment in the stock market a long-term... Read More
Yesterday I received my monthly issue of MONEY magazine. This... Read More
If you are serious about making and keeping money by... Read More
'Sector funds are too risky.' 'I doubled my money with... Read More
The trading method you employ to approach the stock market... Read More
Let's discuss commodities; with the latest Enron situation, it is... Read More
One of the great "secrets" of successful people is discipline... Read More
I was devastated!I just couldn't believe it. I was 10... Read More
One of the great truisms of Wall Street is "Don't... Read More
Every day in any financial publication you will find the... Read More
Professional stock options traders use the term lean to refer... Read More
Cat or dog? Maybe Zebra. Shucks, I don't know, but... Read More
The gleam and bright lights of Wall Street lure in... Read More
Stocks & Mutual Fund |