Interestingly enough, the market today did not make the
month-end run-up we've become accustomed to be seeing. This
phenomenon generally occurs when fund managers play games to spike
their performance. So, what's to explain today's higher open and
subsequent pullback into the red? It could be that the markets are
simply a bit overbought in the short term.
Looking at today's earnings headliners, Mattel (
MAT
) (
full report here
) was a highlight on the upside following a big increase in the
company's dividend payout. Most of the other earnings plays we have
been highlighting ended lower, including shares of Exxon Mobil (
XOM
) (
more here
), United Parcel Service (
UPS
) (
report here
), Archer Daniels Midland (
ADM
), and Radio Shack (
RSH
) (
report here
), whose shares are getting lambasted today. Radio Shack has been
passed around often in the land of "value" players. Fortunately for
us, we have not agreed with that assessment and kept our
distance.
Facebook Coattail Plays Flying Higher
A bubble has developed in the last few trading days, following
rumors that Facebook may file for its IPO this week. Traders have
set their sights on anything and everything related to the social
media space. This trend means real danger for investors tempted by
the 20-30% one-day moves.
I know the lure of quick gains can be hard to resist, but if
your timing is off, you risk some very steep losses. Avoid
rubbernecking the situation and stick to the dividend/income game
plan if you can help it. Take it from a former trader that spent
plenty of days trying to ride these wild horses: often times you'll
wind up with nothing but stress and little gains to show for
it.
Learning to Trust Your Judgement
I recently read about an experiment where a security guard was
placed by an ATM machine that had an "out of order - please give
your deposits to the security guard to be processed" sign. Guess
what? Many people did in fact follow the instructions and gave
their deposits to the security guard! A little risky, huh?
Clearly, some people need to be a bit more careful with their
money. This same concept applies to the investing world, as all too
many people simply follow advice from the wrong sources. It's
critical to develop an ability to separate the good sources from
the bad. Plenty of people rely on professional help these days when
it comes to their finances, and there's nothing wrong with that.
The trouble begins when investors listen to advice from wholly
unqualified people like family members, friends, business
colleagues, etc.
One of our biggest goals at Dividend.com is to make it easy for
investors to develop a simply, conservative approach to investing.
I often stress the importance of creating numerous income streams,
and quality dividend paying stocks are a key element of that
strategy. Once you have an online brokerage account set up at any
of the well-known firms and you have access to our industry-leading
Best Dividend Stocks List
, your job becomes pretty easy. Again, it is great to gain as much
knowledge from various financial professionals, but avoid putting
your money at risk - don't rely on the security guard!
Two New Dividend Stocks Recommended Today!
We just upgraded two new dividend stocks this morning onto our
industry-leading
Best Dividend Stocks List
. Be sure to check out
our
post detailing the upgrade
if you haven't already.
Quick note - if the stocks are moving up too quickly following a
recommendation, it may be best to wait for a pullback. Investing is
a marathon, not a sprint!
Income, Income, Income
At Dividend.com, we maintain our focus on the best
income-producing investments the markets have to offer during time
of heightened volatility. We want to make sure we have only the
most pullback-resistant names on our
Best Dividend Stocks List
. Also, if we see the market putting in what looks like a decent
bottom, we will be prepared to scale up the list of stocks we like.
Stay tuned and be sure to look for
Dividend.com Premium
member alerts along the way. Don't count on the government or your
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do your own research, and achieve your goals yourself!
Go Beyond This Newsletter
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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
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.