what a steep fall....more than 70 points during lunch.
as I type this, it is 66 points in the red.
you should NOT worry if
1) the stocks u bought are based on sound fundamental analysis and market ups and downs are beyond anyone's control
2) u are investing on a long time frame.
2) no contra deals involved.
3) no borrowed money.
4) the original plan is still intact,
In my case, I am a dividend investor, so if this fall continues, this sounds like good news for i can buy more for the same amount of dividend received.
I will be a little concerned if a dividend cut happens and will be more concerned if no dividends declared when i expect some. The latter senario is the one i would least expect since the counters i owned, have paid dividends faithfully for the past 1 decade and have weathered several crises. Even if the least expected senario happens, i am satisfied that i should be diversified enough not to be affected too much.
Hi,
ReplyDeleteIf you own a stock which meets all your requirement, but now it is trading at a "high" price in your opinion. The fundamentals remain the same, with possibly increasing dividend or at least maintaining dividend, though the yield now is low based on current market value. Will you sell?
A. You have no alternative now for reinvesting the money if you sell.
B. You have a few alternatives in your watch list, but they are not as familiar as the current stock you are holding
Just a query and really appreciate your kind response.
M
Hi there,
DeleteThanks for your query. Indeed this is a possible senario for myself too.
A. If no alternatives for reinvesting the money, I will not sell. To hold cash and wait for opportunity is more like timing the market, for which I have no clue where it is heading.
As stated, I do not have alternative for reinvesting the sum. Being vested is better than holding cash, since the counter meets my criteria and since it is producing dividends and likely on increasing trend somemore. But don't forget, I can still reinvest the dividends onto the same counter or onto a different counter, in the latter case, divest the risk elsewhere and create an additional income source.
B. Not familiar with the current stock, then for me, I will NOT buy them. Personally, I only buy stocks which I am familiar with, which I can understand their businesses and an able to work out which each share is actually worth. But this also does not mean I will not attempt to do the research to check whether they are worth buying or not, though that will take some time.
Hope this helps.
Thanks, appreciated your comments.
ReplyDeleteM