First Quarter 2017

“Indexing works great. Until it doesn't”. These sentences are from an ad by Cumberland Wealth Management in The Economist. The bull market is long in the tooth. What do you do if your own an index ETF or fund? Ride it down as you rode it up? Remember that the S&P 500 was essentially flat between 1999 and 2009…for a decade. Dividend growth investors have a plan. That's what I write about inside this site. We concentrate on building an increasing income stream for our retirement. The income stream supports our price. Yield alone does not move the needle. My wife's income rose 7.1% last year. We own only dividend growth stocks. Metro is one example: in 2000 MRU's dividend was 5¢; now the dividend is 65¢. “We know that the dividend growth rate is also the rate at which the stock price grows.” Fundamentals of Corporate Finance, page 217 by Ross, Westfield, Jordan and Roberts. Our capital grows too. We conflate yield and growth.

  • Volatility is not risk. Do not fret about price fluctuations. In Enough, Jack Bogle said “the stock market is a giant distraction from the business of investing”. Dividend growth investors invest. We invest in individual companies…quality firms. What the market does is of little concern to us.
first_quarter_2017.txt · Last modified: 2017/04/19 20:09 by tom
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