consumeronstrike

5 Things to Consider Before Buying and Holding

Capital appreciation isn't everything. You're totally ignoring the fact that millions of people are dividend investors. We don't buy to sell...we buy to KEEP! At least I do. I will only sell if my investment's ability to maintain or increase the dividend seems in imminent danger of being impaired, if free cash flow is slipping, etc. A nowhere market? Fine with me! Is my company's business still sound, is business still good, is its competitive advantage still strong, is it still a market leader, is it maintaining a solid balance sheet and inventories aren't constantly increasing and maintaining financial discipline and allowing itself to become overleveraged? PG has raised its dividend for I think 56 straight years now. What kind of yield on cost would someone now have that bought it 30 years ago? Should this person (who would most likely be living VERY high off the hog on those dividends by now) be thinking, "well, I don't know...maybe I'd better sell now..." knowing without a doubt that PG's ability to pay those wonderful dividends is not threatened in the least anytime soon? I don't think so. Is this person going to panic during some market fiasco such as we had last year? People will still have to buy groceries, no matter what the stupid market's doing. His dividend checks will still arrive. His success depends on the company's ability to make money, not on how the stock does. Either you are a gambler speculating on capital appreciation or you are an investor buying a piece of the business. I know what I am.