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  • The Only Reason For Automatic Dividend Reinvestment [View article]
    Thanks everyone for commenting. If you enjoyed this article, I would encourage you to check my other articles on my website at

    The main reason I don’t reinvest automatically is because it is not the best way to optimally allocate new cash. As was mentioned in the article, I am against paying top dollar for stocks. Now, if you want to pay 30 times for a company like BF/B today through mindless dividend reinvestment, go ahead and ignore everything in this article. It is your money you are wasting.

    Now as for DRIPping, if it can work for you, go ahead and do it. If you have developed a system, good for you, and stick to it. But, also be mindful about changes in brokers, broker failures, your computer crashes and how it affects your recordkeeping. Also be mindful of spin-offs, acquisitions, and how they affect your cost basis etc . We are not talking about the last five years, but for the next 20 – 30 years. I am not that smart to say that I would keep perfect recordkeeping for 80 – 120 dividend reinvestment transactions per company in a 30 – 40 stock portfolio. Add in spin-offs, cash acquisitions etc, and the picture becomes pretty complicated.
    I am highly skeptical that the vast majority of individual investors would do perfect record-keeping of their long-term transactions over a period of 20 – 30 years. In a previous job have reviewed accounting work of professional corporate accountants with years of experience at small companies and large companies alike, and I have found many material errors in their work. So I am skeptical that individual investors who spoke so highly of their own DRIP recordkeeping skills can do what they claim to do and do it well for an extended period of 20 – 30 years. You know, 90% of drivers in Sweden think they are above average, although statistically speaking only half of them can be above average. So do not fall prey to overconfidence in recordkeeping.

    That being said, the articles I write come from my years of experience investing. My methods are very manual, so it is possible that I might have to look into streamlining my process, which heavy on spreadsheets. That works for me, but I only make 24 – 36 transactions/year. I would much rather invest my money in a company yielding 3% and selling below 20 times earnings, than mindlessly reinvest it in a company selling for 30 times earnings and yielding 1%. But then, what do I know, I have only spent the past decade and a half learning all I could find about stock market investing?
    Jan 29, 2014. 02:08 PM | 2 Likes Like |Link to Comment
  • How To Use Leveraged Dividend Growth Investing [View article]
    I don’t think you understood the premise of the article. Please try reading it again.
    You assume my readers are dumb. You are plain wrong.
    Margin could be dangerous in the wrong hands. In the right hands, it could be helpful.
    I assume readers that read my articles are smart, and have their financial house in order. They are smart because they already know how to save money, and want to learn how to invest it. This article is not for the people who run credit card debt and are crushed by it. They are not interested in dividend investing or any type of investing.
    If you think about it, I am not writing about recklessly using leverage to boost returns. I am giving you options on how to use leverage intelligently. You know, a smart person would want to learn about the tools to make them successful. A dumb person would have a loser mentality, where everyone and everything is against them, and where they do not believe they could do anything to increase their odds of becoming successful in life.
    A smart person uses credit cards to earn reward points. A not so smart person uses credit cards to accumulate credit card debt.
    A smart person can use Loyal3 to buy Target (TGT) directly from the company using credit or ACH from their bank, and earn 5% cash back, without incurring any investment costs. They can pay that credit card later.
    A smart person could use margin as a smoothing mechanism for timing purposes. But this is not market timing, this is the timing between the date you find a bargain and the date your paycheck clears.
    For those who want to use me as a contrarian indicator, go ahead. I just want to caution you, because this article was actually written in 2011. It is just that I posted it in 2013. Because of the long-term nature of dividend investing, many of my strategy articles from 2008 – 2013 are still relevant and will be relevant 10 years from today.
    The article also assumes readers are already following the checklist I have of screening for stocks, analyzing companies one at a time, and purchasing them at attractive valuations. Nowhere do I say to throw this out of the window. I always find it annoying when someone reads one article and comments – they are ignoring the fact that everything I write is a cumulative process.
    This is why I don’t comment under articles. I simply do not have the time to correct the incorrect judgments of everyone who didn’t take the time to really think through all the issues. Good luck!
    Dec 20, 2013. 12:05 PM | 5 Likes Like |Link to Comment
  • These 3 Ideas Can Jeopardize Your Investing Success [View article]
    No, I like that you disagree in some items with me. I recheck statements from people who disagree with me against my understanding of the facts, and see if I missed anything or not.

    In a previous article posted on my site, that SA didn't publish here, I discuss that I have blind spots and discussions with other investors and my rechecking my facts make me a better investor.

    I am hoping for prosperous 2014 to everyone!

    In reality, I really hope the next 30 - 40 years are prosperous..
    Dec 11, 2013. 01:26 PM | 7 Likes Like |Link to Comment
  • A Stock Warren Buffett May Secretly Hold [View article]
    I know that Buffett used to drive a VW Beetle a few decades ago. Either way, I doubt a cyclical car company would be considered as investment by the Oracle of Omaha.

    Thank you so much for the research. I guess we would never know which stock he bought, but we can always try to make reasonable assumptions.
    Dec 11, 2013. 08:15 AM | Likes Like |Link to Comment
  • Pros And Cons Of International Diversification [View article]
    Great catch Fireman 45!

    You are correct, it should say " Canada would NOT tax"

    Thanks for reading!

    Nov 24, 2013. 05:45 PM | 1 Like Like |Link to Comment
  • How To Classify Dividend Increases [View article]
    Hahahahaha, you are so full of hate. This is pathetic ( notice I called your actions pathetic, but that is not the same as calling you pathetic).

    I said " weasel out" for your action. I was referring to your behavior.

    To which you replied " you are a weasel". You were personally offending me, which is not cool. I have been called worse, and am a big boy so I brush off the hatred aside.

    I see where the problem lies - you are having trouble comprehending words that are written down and interpreting them the wrong way. You know, if you do not understand something, the way to gain knowledge is to ask politely and not be obnoxious about it. Otherwise, you are stuck where you began in the first place.

    The lack of reading comprehension led to faulty assumptions used about short selling that completely ignored the facts of the article and my disclosure. Dbtunr was particularly unhappy because he/she got called out, as all his/her comments were full of illogical conclusions. This behavior is best characterized by internet trolls, who pick fights with people for the purpose of picking fights. I fell for it this time, but I had to take a stand for once. The net effect is a waste of my time, as usual.

    Since this conversation is going nowhere and is wasting my time, I am cutting my losses and not going to respond to your ad hominem attacks any more.

    Good luck trolling, maybe if you put in enough effort, this website will generate more comments similar to those under Yahoo Finance articles!
    Nov 19, 2013. 08:07 PM | 1 Like Like |Link to Comment
  • How To Classify Dividend Increases [View article]
    Haha, why would I apologize to you?

    It is clearly stated that I am long ADP at the top of the article.

    Yet you concluded erroneously that I am short ADP.

    And thanks for calling me names. When your arguments are not strong enough in the first place, it is always best to call people names in order to save face.
    Nov 19, 2013. 04:55 PM | 6 Likes Like |Link to Comment
  • How To Classify Dividend Increases [View article]
    You said:

    "You are not making that case here to buy ADP in the event that everything goes down."

    I simply said buy ADP below $63. Why can't the stock go down because the market is down?

    Your original thesis is that a stock that goes down, is broken. You should stand up for your word, and not weasel out. If you do change it, you should admit being wrong, and apologize for being obnoxious.

    Otherwise, the way I look at it:

    1) It is okay for you to back out of your original thesis that a stock that goes down is broken, by the excuse that the whole market was down

    But it is not ok

    1) When I say the stock is going, to assume that this would happen because the market is down
    Nov 19, 2013. 04:29 PM | 2 Likes Like |Link to Comment
  • How To Classify Dividend Increases [View article]
    I missed BDX at the end of 2012/early 2013.. Now I am just watching it go up and up. I finally understand what Buffett means by " mistakes of omission"
    Nov 19, 2013. 02:57 PM | 1 Like Like |Link to Comment
  • How To Classify Dividend Increases [View article]
    I am fine when people disagree with me ;-) In fact, whoever investor/s have been selling me shares for years, have been thinking differently than me.

    The P/E ratios and yields I discuss are in order to screen universe of stocks to a more manageable level. Then you go an analyze them one by one, and determine which one/s is/are the best for your capital, subject to existing allocations.

    This is why investing is part art, part science - you can't fit it into a simple formula (unfortunately). Even those who thought index funds was the sure fire formula to invest without looking at things like valuation, suffered in the first decade of 2000
    Nov 19, 2013. 02:56 PM | Likes Like |Link to Comment
  • How To Classify Dividend Increases [View article]
    So if stocks dropped by 50% over the next year, you would not buy them, because they are "broken"?

    In other words, anyone who bought in 2008 - 2009, and not in 2007, is probably a fool in dbtunr's eyes, because they were buying "broken stocks".

    Did you know that price is what you pay, while value is what you get in return?

    Patience is a virtue that few investors posses, hence so many lose money.
    Nov 19, 2013. 02:50 PM | 5 Likes Like |Link to Comment
  • Stop The Presses: Academics Confirm That Buffett's Success Is No Mystery [View article]
    Thanks for your review David. I have recently been overdosing on Buffett myself to the point where I posted a lot of resources about him on my website:

    However, I also read a study according to which if you had followed Buffett's picks between 1976 and 2006, you would have earned 25%/year on average. So i think his picks (shares and whole businesses) have probably a great deal to do with his success.

    The float is probably important too, as it provided some magnifying factor. However it is also dangerous if you don't know what you are doing - check AIG's issues.
    Nov 18, 2013. 11:07 AM | 4 Likes Like |Link to Comment
  • 1993's '100 Best Stocks': How They Fared [View article]
    Hi Kevin,

    That is extremely helpful. I have been using old S&P and Moody's manuals, but did not even think about using SEC filings.

    Based on your input, I think you probably spent more time than I actually thought you did originally.

    Google archives also has decent information on newspapers that have stock quotes.

    I was actually trying to back-test the Dividend Champions of 1991, and got lost in the spinnoffs, mergers, acquisitions of a few companies and just gave up.. Your article gave me inspiration to keep at it.

    I hope you keep writing great articles sir! (like this one)

    Best Regards,

    Nov 12, 2013. 10:26 AM | 4 Likes Like |Link to Comment
  • 1993's '100 Best Stocks': How They Fared [View article]
    This is an awesome article. You probably spent a lot of time performing this research.

    I am curious, what resources did you use to calculate returns of stocks which are no longer listed? I did some backtesting a while ago and came up with some stocks which are no longer here.. So I could not reasonably calculate what happened to them..

    Your input would be very helpful.
    Nov 12, 2013. 10:03 AM | 3 Likes Like |Link to Comment
  • Lockheed Martin: A High Yield Dividend Growth Stock [View article]
    Those are good points. I am not sure how modern warfare would evolve in 21st century to be honest, but cyberwars are probably going to be big moneymakers.

    There are things to prevent you from buying every time. I get your point on JNJ and KO but I still find them safer. I did this by answering the following questions for myself:

    How many products is KO selling and in how many countries, and what is the product and geographic diversification of revenues vs those of LMT?

    Which one is "safer" - a company dependent on 80% of its sales on a single customer or a company that is dependent on hundreds of million of customers?
    Nov 6, 2013. 08:54 PM | 1 Like Like |Link to Comment