Each week you'll learn how to be a better dividend investor and follow the journey of a welder with a passion for passive income to $1,000,000 and beyond.
Share
Below Zero: Where Smart Money Grows
Published 8 months ago • 3 min read
Presented By: The Early Bird from MarketBeat
Official Affiliate Partner: The Early Bird from MarketBeat
I was stopped at an intersection in Elk Grove Village, IL, on Tuesday morning, looking at the Elk Preserve. Good God, was it cold!
The air temperature was -8°, the wind chill was -25°, and the Elk were hanging out in an open field, naturally making me think about investing.
Our furry friends, the Elk, have been around for 25 million years and have adapted and evolved to survive the harshest winter conditions.
Our good friend, Mr. Elk
Elk shed their summer coat and grow a thick, two-layer, wooly winter coat that's 5 times warmer. They've also learned neat little tricks, such as losing less heat if they tuck their legs underneath them when lying down.
And you know what happened to the animals that didn't adapt and evolve?
They went away.
Investors adapt and evolve to survive the harshest market conditions, and those who don't likely will watch their money go away, too.
I started "investing" in penny stocks. This was a fun and frustrating way to light money on fire.
Then, I became a swing trader, which improved my results until it was time to sell. I learned I'm awful at following rules and holding too long, for better or worse.
Next, I stumbled into dividend investing, where a "buy-and-hold" tendency is an advantage—provided the correct companies are bought and held.
My buy-and-hold strategy has evolved, such as my shift away from chasing yield, buying companies without a solid dividend growth streak, a microscopic dividend growth rate, or companies with a dividend payout ratio that's chronically too high.
An example was buying AT&T (T) and Verizon (VZ). These companies operate in highly competitive and capital-intensive industries, and paying a high dividend dragged on the total investment return.
I realized that companies like this are best left for those using passive income to live without worrying about stock price growth.
If you follow my content, you know another evolution is underway. In this one, I aim for no more than 15% individual stock exposure across our entire investment net worth.
It's an admission that I'm not smart enough to "beat the market," but I still enjoy researching and picking individual companies for passive income.
But our money must survive the harshest market conditions and my stock-picking abilities.
Famed investor Joel Greenblatt's quote hits home, and sometimes I wonder, "Am I an idiot?"
I don't want to be an idiot with our money.
The goal is to have enough money and passive income to do what I want, when I want, with whom I want, and keep things I don't want to do at a minimum.
Your end goal may differ, but that makes this investing journey so much fun: meeting everyone and learning what you all are buying and investing for.
I'd love you to reply to this email and tell me your end goal or what you're buying. I'll reply to every response!
😁THANK YOU to all who responded to the last newsletter!!
William Green, author of one of my favorite investing books Richer, Wiser, Happier, was a guest on the afford anything podcast. This was a fantastic episode my wife and I listened to driving to Indianapolis, and she enjoyed the stories that William shared. Check it out!
🎦If you missed it, 18 cheap dividend stocks with strong or very strong credit ratings + a hack to get FREE Morningstar reports!
Click the image above, sign up for a 7-day free trial, and get $30 off!
*This is an affiliate offer, and I will receive a small commission at no additional cost when you buy a premium annual subscription after clicking the image above.
Special offer: $30 off Premium for the first year. At the end of the free trial (or immediately if you are no longer eligible for a free trial), $269 is charged automatically for the first year of your annual subscription. Auto-renews at the then current annual list price.
Each week you'll learn how to be a better dividend investor and follow the journey of a welder with a passion for passive income to $1,000,000 and beyond.
🚨A quick word: I'll be a guest speaker at the Blossom Investor event in Chicago on Tuesday, October 7th. Grab a 15% discount with DAPPER15.🚨 Warren Buffett once admitted a big investing mistake - "thumb sucking" with Walmart. He started a position, the stock price kept going up and he stopped buying. Instead, he sat there sucking his thumb, waiting for it to come back down because he thought it was too expensive. It never did. He ended up with a small position he eventually sold, and said...
🚨A quick word: I'll be a guest speaker at the Blossom Investor event in Chicago on Tuesday, October 7th. Grab a 15% discount with DAPPER15.🚨 Yesterday, I attended a wedding, and as the young couple exchanged vows, I couldn't help but think about investing. Charlie Munger said, “Marriage is the most important decision you have, not your business career. And it'll do more for you good or bad than anything else. And Ben Franklin had the best advice ever given on marriage, he says, "keep your...
🚨A quick word: I'll be a guest speaker at the Blossom Investor event in Chicago on Tuesday, October 7th. Grab a 15% discount with DAPPER15.🚨 Warren Buffett once said, "Wall Street will sell what it can sell, just remember that." The YouTube algorithm suggested a video which caught my attention and I felt something had to be said, even though I promised Ryne Williams I wasn't going to write or talk about these things anymore. But the flesh is weak, Ryne, and I need to get this off my chest....
