Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Dividend investing for retirement -- Ignore unavailable to you. Want to Upgrade?

To: E_K_S who wrote (6367)	11/12/2010 11:29:04 AM
From: Steve Felix	Respond to of 34328

Thanks E_K_S, I always like insight into how others think about portfolio management, probably because I try and do very little of it, but could possibly use a few rules. I have accepted the fact that Mr. Market is smarter than I am the vast majority of the time. He's shown me that. Short story about one of my best beginning trades, that ended well, but poorly compared to how it could have. Funny how we don't forget these things. Bought 1000 LH in 99' @ $3.50. I don't think it had a PE, although S+P shows it at a high of 57 in 2000. Tangible book value in 2000, nine cents. After a 1 for 10 split, I sold in less than a year @ $68, almost a double. While I celebrated, it split 2 for 1 in 2001 and 2002 and now sits at $82. LH was never a dividend stock, but that trade is one reason I don't put as much focus on PE as many do. It was also another brick in the wall that has shown me that most times sitting on my hands is the best choice. Focusing on the income and not gains definitely helps me keep my hands off. O seems certainly over valued here with a 5% yield and a PE of 37. I may sell another 100 shares to bring its portfolio percentage under 16%, or I may just accept that it will trail the market return for a while going forward. Having the dividend income gives me options. It has been proven to beat the market regularly. Too much help from me can only mess it up imho.

To: E_K_S who wrote (6367)	11/12/2010 2:33:17 PM
From: chowder	Read Replies (3) \| Respond to of 34328

Another dividend portfolio strategy I have read about, but don't use, is knowing your companies yield history. A publication like Value Line makes this easy to monitor. They list 15 years of performance on one easy page with annual highs and lows, annual EPS and dividends. According to Kelley Wright, author of "Dividends Still Don't Lie," he says most stocks have a yield range history. He sells when the yield gets down to the historical range. He buys when the yield gets up to the high historical range. So in other words, if KO had a history of getting as low as yielding 2.1% as an example, and history showed that's where price topped out, that is where he would sell. If KO's history showed the yield only getting up to 4% for example, and then that's where price started to rise historically, that's where he'd buy. (I don't know KO's yield history, I was just providing an example.)