Market Wrap-Up for May 9 (DIS, MELI, TM, TEVA, M, GLD, more)

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Spain banking concerns added to recent investors' fears this morning, with the markets once again opening sharply lower. The markets staged a late-morning comeback (as news began to spread Greece would be receiving further relief - i.e.m another bailout of some sort), but couldn't come full-circle as the averages ended in the red. As usual, we'll be looking closely at some potential portfolio shifts (subtractions, additions) where we see fit.

The recent volatility we've been seeing in the markets could be a sign of things to come this summer. Volume tends to be much lower during the summer months, with money managers on vacation. Hence the importance of owning high-quality dividend stocks, which have large long-term shareholder bases and offer a haven from the manic price movements of growth-oriented names.

Looking at today's big movers, earnings results caused some investors to trim shares in the likes of Mercadolibre ( MELI ), Agrium ( AGU ), Macy's ( M ), and Teva Pharmaceuticals ( TEVA ). On the flipside, shares of Walt Disney Company ( DIS ) and Toyota Motor ( TM ) attracted some buying on their earnings reports. Meanwhile, Wall Street analyst downgrades pushed down shares of CF Industries ( CF ) and Ace Ltd. ( ACE ). Finally, Gold ( GLD ) prices continue to meander despite the murky global economic picture. Warren Buffett's bearish opinion of gold as an investment this past weekend is holding up.

How's Your Retirement Picture?

Here's some eye-opening retirement data I recently came across:

- Americans 10 years away from retirement have saved just $78,000 on average, even though the Employment Benefit Research Institute says the average worker will need to have saved $900,000 to maintain his or her lifestyle after retirement at 65.

- The average American has saved just 7% of what he or she hoped to retire on.

- 25% of middle-class Americans now say they plan to work until age 80.

- The Center for Mature Consumer Studies at Georgia State University reports that the average boomer has assets of just 10 to 15 percent of what their parents had - and far more debt!

If you find yourself falling into the categories mentioned above, don't worry yourself sick about it. A few simple changes will set you on the right track.

Start cutting debt immediately, especially high interest debt (credit cards, etc.). Keep your living expenses as low as possible, so you can free up money every month that can then be invested into income-producing assets (dividend stocks). The power of compound will be your greatest ally in generating long-term wealth.

If your home is your biggest expense as you near retirement, think about downsizing or even relocating to an area where the cost of living is much lower. Taking on a part-time job can also help pad your income and even provide health insurance (yes, some companies provide benefits even for part-time workers).

Remember, the retirement picture hasn't suddenly started deteriorating overnight. We've been seeing gloomy data for years indicating how poorly-prepared Americans are for their later years. You won't find much help from the business media, as the experts on television are mainly concerned about which stocks will work for the next morning or the next earnings report.

To be successful in long-term investing, you need a plan. Let's take a look at some of the basics that any financial plan should include. First of all, you must have ultimate goals in order to put together a financial map to follow. Understand your risk profile and where you are in life, in relation to what the top-line goals are. For example, if you are afraid to take on much risk in your later years, you could consider taking on less exposure to stocks.

The key thing to remember about a financial plan is to be flexible. Your life changes, and so should your plan. There is no reason to roll the dice if you're about to cross the finish line with a great record to show for it. Greed can often get in the way of using smart financial sense. As families come into play, you'll eventually need to consider your estate situation, identifying the beneficiaries for specific holdings, and make sure you have enough insurance to protect your loved ones. Make it a habit to perform an annual evaluation of where you are financially, as well as the situation regarding the economy and how that could affect your investment holdings. You can also work with a financial planner that is cognizant of these factors. When working with a planner, holding information back is never a smart thing. Don't ever let pride get in the way of you or your family's financial well-being.

A good financial planner will help you construct your short-term and long-term goals, analyze where your money is currently being spent, as well as figuring out where you may want to look for investment ideas that fit your risk profile. Too many marriages fall apart as a result of money issues. Having the guts to lay your cards on the table and see what needs to be done can help avoid further financial hardship that a marriage split will certainly bring.

At the end of the day, taking financial responsibility and knowing what you can afford to do is essential. I talk about investing in quality dividend-paying stocks as a great way to build up your future income, but if you are spending like there's no tomorrow, then you risk negating all the good you've done on the investment side of things. We'll continue to do our best at Dividend.com to help you find new income sources you can begin to build or add to positions in, but the rest of your financial health will depend on some of the things I mentioned above. Get to it as fast as you can and you'll be happy you did.

Special Players Have Bad Games - But Not Very Often

Even the best athletes sometimes put in some bad performances. It's impossible to play at an extremely high level in every single game. Similarly, as investors, we need to understand that not every stock we buy will be a home run. There are bound to be some duds along the way.

If you study your investing mistakes closely, you'll likely avoid the same missteps in the future. Thus, your overall performance will remain remarkably consistent year after year. Failure is a natural part of any ultimately successful process. It's impossible to be perfect. The key is sticking with your game plan and trusting your investing skills.

On Wall Street, you'll hear about how many of the greatest traders who rose and fell over time. Their manic approach is quite different from our message here at Dividend.com. We tend to avoid the all-in and all-out timing calls that can make or break the best of traders. We also accept the fact the markets will sometimes toss us a curve ball that requires us to make adjustments. We don't hesitate to make those difficult calls when the situation warrants - and neither should you.

An Important Note Regarding the Best Dividend Stocks List

We want to make sure everyone understands that the stocks on our Best Dividend Stocks List are the names we currently like for new investor capital, regardless of what date the stock was first recommended on. If and when a stock is removed from the list, we will clearly state whether the stock should be sold (which is rare but occasionally will happen), or simply held in one's account until we see a better entry point or catalyst.

And here's one last thing to remember about what we do here at Dividend.com: it's not just the names that we recommend that can help you build wealth, but also the things we try to steer you away from that are just as important. Forget about speculative or penny stocks, chasing unprofitable IPOs, and listening to the manic talking heads in the business media!

Our Beat The Markets with Dividend Stocks eBook Has Arrived!

We just debuted our brand new 275-page eBook, exclusively on Dividend.com! In this digital-only book, we look ahead to 2012 and the main factors that could affect dividend investors. A $39.95 value, the eBook is a free download for paid Dividend.com Premium subscribers.

Beat The Markets with Dividend Stocks contains a full economic forecast for 2012, including in-depth analysis on 65 of the biggest dividend stocks out there. It's a great way to get prepared for your investing next year! So head over to the Dividend.com Premium homepage now to download your copy.

A Dividend Capture Strategy for Active Investors

We now offer complete U.S. dividend data for all Dividend.com Premium members, so anyone that focuses on "Dividend Capture" trading strategies should have plenty of good stuff to research each day. Just check our enhanced Ex-Dividend Calendar , which is the best in the business, to search for upcoming payouts.

Speaking of dividend capture, Dividend.com Premium members can also access a 9-page report we published on the essential elements to any successful dividend capture strategy. Be sure to check it out here on the Premium homepage .

Dividend.com's Very Own National TV Commercial Has Debuted

Our first-ever television commercial! has started running on CNBC and the feedback has been wonderful. If you haven't seen the link yet, you can check out our commercial here .

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 .



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Created by Dividend.com


This article appears in: Investing , Stocks

Referenced Stocks: ACE , AGU , CF , DIS , GLD

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