The Euro broke below the $1.30 level this morning against the
U.S. dollar as uncertainty surrounding the European debt crisis
continues to mount. Also, the price of gold broke below the $1600
an ounce mark as the recent attempt to rally on news of ECB's
desire to print as much as it needs to battle the economic
conditions failed to materialize.
Gold-mining plays like Barrick Gold (
) and Newmont Mining (
) moved lower in unison with the drop in gold prices. Also moving
lower were shares of mining equipment play Joy Global (
) following the company's earnings results. Wall Street analyst
downgrades also weighed on shares of fertilizer play Mosaic (
) and retailer Kohl's (
). Bucking the early selling were shares of Broadcom (
) which raised its guidance this morning, but the stock gave back
most of the day's gains by the close. A similar situation occurred
with shares of Avon Products (
) which announced it will begin searching for a new CEO to replace
Andrea Jung, who will be fill the role as chairman of the company.
The stock opened nicely higher, but also finished well off the best
levels of the day.
Defending a Loss
One of the biggest mistakes we often see from the retail
investor to the big money manager is the decision to defend losing
positions by buying more and more. When you look at an overall
market drop and you see most stocks dip, the reason to buy some
more of a quality dividend stock is understandable. However, when
you see a stock-specific situation developing and the particular
shares of this company sells off day after day for fundamental
reasons, the risk you could be throwing good money after bad rises
It doesn't stop with investors. We often see insiders step up
and think they know the company's outlook better than Wall Street.
No one could argue, shouldn't they? Yes and no! Yes, they may have
a sense the company is doing better than their rivals, but if the
industry they are in has a potential expiration date, Wall Street
will not wait long to begin pricing in the likelihood the company
becomes yesterday's news. Will Wall Street get it wrong from time
to time? Yes, it can, but more often than not, they are going to be
right (the stock tape is ultimately the final judge and jury).
Think about this when you are examining what you may own in your
portfolio. We have many new investors that join our
newsletter/service every day looking for a better investment
strategy. Some of these investors may be holding some stocks that
have little chance of ever coming back to their old highs. As I've
said in the past, you must not be ever be afraid to pick those
weeds out and use whatever monies left to put to work in quality
Just like mold that can grow on food or weeds in a garden, no
one likes to see it and can't wait to get rid of it. Treat your
portfolio with the same sort of care.
2011 Has Been a Big Year for Dividend Stocks!
It is always great to see the media tip their hat to what has
been a great year for dividend-paying stocks. We're seeing several
major media outlets publishing articles about how dividends were a
big investing theme in 2011.
The truth is that we tend to see solid years more often than not
in the dividend world, but the business media focuses their
attention instead on the high-risk momentum action. Only in times
of extreme duress does the media seem to focus on our dividend
niche. Regardless, we won't be distracted from our job of finding
the best dividend names to put fresh capital into.
I'd like to thank all our
subscribers and newsletter readers for helping spread the word
about our service. It means a lot to us, and telling loved ones
about Dividend.com is the best possible gift you can give to us
this holiday season.
Beat The Markets with Dividend Stocks
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contains a full economic forecast for 2012, including in-depth
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A Dividend Capture Strategy for Active Investors
We now offer complete U.S. dividend data for all
members, so anyone that focuses on "Dividend Capture" trading
strategies should have plenty of good stuff to research each day.
Just check our enhanced
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Speaking of dividend capture, Dividend.com Premium members can
also access a 9-page report we published on the essential elements
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Thanks for reading everybody. I'll see you tomorrow!
Be sure to visit our complete recommended list of the
Best Dividend Stocks
, as well as a detailed explanation of
our ratings system here
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