Archives For Investing

I try to look at things differently.

Let’s face it, market declines like we have seen in the last week are no fun—especially for those of us who have built up sizable retirement accounts over the years. That said, stock market declines are not all bad. One way to think about them is imagine you are in a store that is having a BIG SALE and your goal is to stock up.

I did some research and looked at the price changes for the stocks in the S&P 500 Index (my S&P 500 Index component source returned 502 stocks) from Friday’s close (08/21/2015) to today’s close (08/24/2015). I assumed that a person had $100,000 to invest. I ignored brokerage fees and assumed whole-share purchases. Then, I estimated the expected annual dividend payment using those numbers and compared those numbers with the numbers I got with Friday’s closing prices. The difference was pretty amazing.

For example…

On Friday, you could purchase 1,320 shares of Chevron at Friday’s close and 1,387 at today’s closing price. Assuming the dividends stay the same, Chevron would pay you an annual dividend of $5,649 based on Friday’s purchase price or $5,935 at today’s price. That’s a 5.05% increase.

Granted, these numbers come with risk. For one, the stock price could decline more. Also, the dividend could be reduced or even eliminated. So, there is risk.

That said, if you are still interested, here is a link to a PDF copy of my findings:

A Different Way to Look at the S&P Decline

The stocks are in alphabetical order.


August 24, 2015 — 3 Comments

Take a look at the following image that I snagged off the WSJ Markets page:

DJIA 1-Hour Into Day 08-24-2015

As you can see, the DJIA has made up about half of its opening loss. Sounds good until you realize it’s still down 432 points.

It’s going to be a long day.

Rough Waters Ahead

August 24, 2015 — Leave a comment

Brace yourselves…

1. It looks like today could be a rough day for the stock market.

E-Mini SandP 500 Futures (ESU5) 08-24-2015

2. All sorts of “experts” are going to be telling you that their expensive insurance products could have protected you from all of this.

3. Peter Schiff is happy.

The nearly 2,000 point drop in the Dow Jones Industrial Average from its high has wreaked havoc on a lot of stocks. Below is a list of stocks in the S&P 500 Index that currently have dividend yields of 4% or greater. Now, it is IMPORTANT to note that when times get tough, many companies have to reduce or eliminate their dividend altogether, so it’s critical to take that into consideration before investing in any of these stocks. That said, this list could provide a decent starting place when looking for yield.

Frontier Communications Corp FTR 5.15 0.42 8.16%
CenturyLink Inc CTL 27.11 2.16 7.97%
ONEOK Inc OKE 34.13 2.42 7.09%
Mattel Inc MAT 22.58 1.52 6.73%
ConocoPhillips COP 45.39 2.96 6.52%
Iron Mountain Inc IRM 29.24 1.90 6.50%
Kinder Morgan Inc KMI 31.79 1.96 6.17%
HCP Inc HCP 39.93 2.26 5.66%
Chevron Corp CVX 75.76 4.28 5.65%
AT&T Inc T 33.38 1.88 5.63%
Marathon Oil Corp MRO 15.73 0.84 5.34%
Spectra Energy Corp SE 27.72 1.48 5.34%
Garmin Ltd GRMN 38.26 2.04 5.33%
Ventas Inc VTR 59.60 3.16 5.30%
Centerpoint Energy Inc CNP 19.31 0.99 5.13%
Chesapeake Energy Corp CHK 6.87 0.35 5.09%
Helmerich & Payne Inc HP 54.75 2.75 5.02%
National Oilwell Varco Inc NOV 37.21 1.84 4.94%
Philip Morris International PM 80.98 4.00 4.94%
General Motors Company GM 29.60 1.44 4.86%
Health Care REIT Inc HCN 68.42 3.30 4.82%
Realty Income Corp O 47.62 2.28 4.79%
Entergy Corp ETR 69.39 3.32 4.78%
Murphy Oil Corp MUR 29.27 1.40 4.78%
Verizon Communications Inc VZ 46.10 2.20 4.77%
The Williams Companies Inc WMB 49.65 2.36 4.75%
Southern Co SO 45.80 2.17 4.74%
Transocean Ltd RIG 12.78 0.60 4.69%
Navient Corp NAVI 13.89 0.64 4.61%
PPL Corp PPL 32.90 1.51 4.59%
Seagate Technology STX 48.72 2.16 4.43%
Coach Inc COH 30.71 1.35 4.40%
Host Hotels & Resorts Inc HST 18.29 0.80 4.37%
KLA-Tencor Corporation KLAC 47.70 2.08 4.36%
Occidental Petroleum OXY 69.26 3.00 4.33%
Ford Motor Co F 13.86 0.60 4.33%
Plum Creek Timber Co PCL 40.77 1.76 4.32%
Duke Energy Corp DUK 76.71 3.30 4.30%
AGL Resources GAS 47.86 2.04 4.26%
People’s United Financial Inc PBCT 15.77 0.67 4.25%
FirstEnergy Corp FE 33.99 1.44 4.24%
TECO Energy Inc TE 21.68 0.90 4.15%
Caterpillar Inc CAT 75.00 3.08 4.11%
Exxon Mobil Corp XOM 72.13 2.92 4.05%
Viacom Inc B VIAB 39.87 1.60 4.01%
Pepco Holdings Inc POM 27.03 1.08 4.00%

Oil Glut?

August 21, 2015 — 1 Comment

OIl Glut

I find it interesting that we now have an oil glut when just a year or so ago, people were predicting $150 per barrel oil would be the new norm.

How is that possible?

How did no one see it coming?

Oh, and now “they” are saying that there is no end in sight for this oil glut. You have to love these “experts.”

In other news…the market’s beating is putting lots of stocks on sale. Perfect for those of us who are still saving for retirement.

Below is a YTD chart for the Dow Jones Industrial Average (price return, which does not include dividends). I added a trendline. As you can see, it can’t get much flatter than that.

Flat Dow in 2015

As you can tell from the following chart, the S&P 500 Index has not had a very good 2015. Through yesterday’s close, the S&P 500 Total Return Index (includes dividends) is up 1.95% YTD.

SandP 500 YTD 07-10-2015

The trendline is not very steep.

It will be interesting to see what the rest of 2015 has in store. I’m not expecting much. At this point, I don’t really care. We’re still saving for retirement and up markets at this point, don’t help us much.