The market saw a bit higher-than-usual volatility today, as investors were happy to see some positive consumer spending data, but were mixed on some of the earnings data that was reported. As well, personal income rose to the highest level we have seen over the last eight years. If there is going to be any sign of a sustained economic expansion, personal income growth must see a sustained pick-up.
As I mentioned, earnings took center stage once again today on Wall Street, with several big names reporting their latest quarterly results. Today’s winners feeling Wall Street’s love on results included the likes of Qualcomm (QCOM), Mead Johnson Nutrition (MJN), Las Vegas Sands (LVS), Whirlpool (WHR), and Blackstone Group (BX). On the flipside, investors were selling the news in names like Harman International (HAR), Colgate-Palmolive (CL), Dow Chemical (DOW), Time Warner Cable (TWC), and Avalon Bay Communities (AVB).
Be sure to check out The Dividend Daily for all of our latest coverage of these important earnings events.Get Complacent, Get Replaced
My oldest daughter has been rowing crew for a few years now, and recently let me in on a real shocker regarding her crew boat. You see, the boat’s coxswain from last year (the one who steers the boat and keeps the tempo) has been usurped by a hungry younger upstart.
Last year’s coxswain thought for sure her job would be safe for her senior year. In fact, she joined the swim team over the winter rather than doing winter crew (crew is traditionally a spring sport, but they do some training and races in the fall as well). Well, this girl though it was a given that she’d return to her regular spot this season — she’s the incumbent, after all. Yet here comes along a girl one year younger than her who spent her entire winter training hard, polishing her skills, and eventually leading the boat to a lot of success during winter races. As a result, this junior now has the coxswain seat, while the senior girl is left out in the cold.
The lesson here is pretty simple. There will always be someone out there who is as hungry as you (or even hungrier), just waiting to take your place. When you least expect it, you could be on the outside looking in. This complacency happens early in life when we are in school getting our great grades and then suddenly out of the blue someone is standing beside you getting as good or even better grades. You get to your professional career and suddenly a promotion that may have been thought of as a piece of cake turns into a real battle when someone steps up unexpectedly and makes a huge challenge no one saw coming. This is also how businesses get beat every day of the week, whether it’s a small mom-and-pop outfit or a major publicly-traded behemoth.
For investors, if you start slacking on the ongoing education to keep your tools sharp, you risk losing the edge you may have been used to. It’s really all relative. The best athletes who win multiple championships will tell you they don’t let up when it comes to practice. The efforts required to get to the top are immense, but to stay there means you have done something extraordinary! Invest in whatever helps you get there, but don’t get complacent when you do.Our 2013 Dividend Stock Guide Has Arrived!
Our new members-only eBook has just been released! This 250-page guide to investing in 2013 contains a concise economic forecast for next year, including full previews for 60 big-name stocks! Be sure to head over to Dividend.com Premium and download it and get your game plan in place for all good things dividend-related in 2013!25 Years of Dividend-Increasing Stocks
We recently updated our list of dividend stocks that have been paying out dividends for 25 years or more. Be sure to check out the latest list of names here.Dividends Really Matter
Financial blog DailyReckoning.com recently took a look at the difference dividend payouts made in the overall return investors saw throughout the prior decades. Here are some of the highlights:
- The Nasdaq is down 28% since the end of 1999. Even the “blue chip” S&P 500 stocks are down 15% during that time frame…until you add back those “boring” dividends. With dividends included, the S&P 500′s 15% loss flips to a 6% gain.
- Without dividends, the S&P 500 index would have produced a loss for the 25 long years from August 1929 to August 1954. Then again, without dividends, the S&P 500 produced a 5% loss during the 13 years from September 1961 to September 1974. But with dividends included, the S&P’s loss became a 46% gain.
- Over the course of the last half-century, dividends have contributed more than half of the stock market’s total return — 56%, to be exact.
Of course, you can’t discuss the potency of dividend investing without making mention of how awesome compound returns are. I can’t stress enough the power of compound interest: you take a small amount of money and turn it into a large amount over time. Finding the right companies at the right price points which not only grow earnings, but also grow their dividend payouts as well!
We have much more about why Dividends are so awesome if you check out our “What is a Dividend?” page here.New Watchlist Article Out Today
Be sure to check out our weekly Top 50 High-Yield Watchlist Names post that is out today, exclusively for Dividend.com Premium members. This list gives readers a good idea of what stocks we’re watching behind the scenes here for potential upgrades.Go Beyond This Newsletter
We know many of you enjoy reading the daily newsletter, but remember that with our Dividend.com Premium service, the newsletter is just one small component of what we offer. Here are the “Big Three” benefits of our Premium service:
- The Best Dividend Stocks List is used by tens of thousands of investors to help build their own portfolios.
- Creating your own Watchlist allows you to track the performance, news, and upcoming dividend payouts of the particular stocks you care about.
- Finally, we offer the most complete and easy-to-use dividend data on the web. Many subscribers use this data as part of a “Dividend Capture” trading strategy, but long-term investors can use it to keep track of impending payouts. Just visit our Ex-Dividend Calendar for a complete outlook on which companies will be paying out soon.
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Thanks for reading, and I’ll see you tomorrow!