A Guide to Stock Market Investing

 A Guide to Stock Market Investing

dividend income distributed on a weekly basis throughout the year. If you own more than twelve businesses, you are likely spreading your capital too thin.
6. It is recommended to consistently use dollar-cost averaging every three months. To augment your assets on a quarterly basis, in addition to reinvesting dividends, you need establish a savings strategy.
7. A dividend yield of 2.0% or higher is required of stocks that are bought. If a company is utilizing the majority of its profits for expansion, then a low dividend yield of 2.0% is not necessarily a bad thing. A growth stock is one in which the company's business, income, and earnings are projected to grow. The higher expected rate of stock price appreciation more than makes up for a growth stock's lower dividend yield.
8. A minimum of eight years of continuous dividend increases should be evidence of the company's longevity. This will make investing in a new, potentially dangerous business (the kind that will revolutionize the world, but are notoriously difficult to identify) completely unnecessary.
9. A dividend reinvestment plan (DRIP) for the company's stock is required. If your firm's quarterly dividend is $2.63, the company or their Transfer Agent should automatically use that money to buy you a different percentage of shares, or partial shares.
Buying businesses with the expectation of receiving increasing cash dividends for the remainder of your life should be your number one investment goal.
"The Stockopoly Plan," my soon-to-be-published book with American-Book Publishing, lays out all the necessary steps for launching an investing program that prioritizes the aforementioned factors.
The following is a chapter from the book that I would want you to read.
When you hear a term in English, have you ever thought about how aptly it describes its meaning? And the way certain words appear to be, I suppose you might say in reverse? Take the term "sunflower!" as an example. The sunny yellow flower that blooms from dawn 'til dusk has the most perfect name: the sunflower. Then there are words like "parkway" and "driveway" that seem to have the opposite connotation in English, almost backwards. My mental image of a parkway is the one I use when my car is parked at home, and the one I use when I am traveling somewhere else is a driveway.
In the context of the stock market, I find the words analyst and stockbroker to be just ideal. Now I will tell you about the "brainwashing mantras" used by Wall Street.
A stock rating of 1, 2, 3, etc., can be one of Wall Street's brainwashing mantras. A star, one star, two stars, etc., could also be used as a mantra. Any combination of the following words or phrases can serve as a mantra: appealing, unappealing, neutral, market perform, market out-perform, market under-perform, market under-weight, equal weight, over-weight, sector perform, strong buy, buy, sell, strong sell.
These cliches have grown into multibillion dollar enterprises because they are so embedded in the minds of Wall Street and investors. Bollinger Bands, named after its originator John Bollinger (who used to be a regular on CNBC), which deal with the channels a stock trades in reference to its "moving average"—another mantra—and RSI (relative strength index), are two examples of different forms of mantras. There are many technical indicators that can be used to analyze stock prices. These include stochastics, momentum, moving average convergence/divergence (MACD), 50-day and 200-day moving averages, triple bottoms and tops, pendants, flags, bear and bull markets, head-and-shoulders formations, double bottoms, P/E ratios, and plenty more. The creation of commissions is the ultimate goal of all these mantras (which, I must agree, are great tools for those who are inclined to trade in the market). That being said, I fail to see any practical use for dollar-cost averaging investors who purchase shares of companies without commission fees, whose companies increase their dividend annually, and whose goal is to generate 85% tax-free income for the rest of their lives through these ever-increasing dividends, regardless of the market price of the stock. (Oh my! What a phrase!
Stop by http://www.thestockopolyplan.com for more snippets from "The Stockopoly Plan."
Wow, that is cool!

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