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The Quarter That Cost Me $8!🤬
Published about 2 years ago • 3 min read
Presented By: The Early Bird
Official affiliate partner: The Early Bird from Marketbeat.com
I feel pretty dumb writing this, but you gotta hear it.
This week, I stepped over $8 lying on the ground to pick up a quarter that I kicked into a sewer drain.
And the $8 blew away, so I got neither.
Here's what happened: after selling off my remaining seven shares of the Schwab U.S. Large Cap Growth ETF (SCHG) in the ROTH account, I had cash to scoop up a few more shares of Visa (V).
Visa is a newer position we're building out. It currently has 29 shares at an average cost of $264.89, and it's probably fairly valued in the $260 - $270 price range.
Visa is also a solid company with no credit card default risk and only makes money when it processes payments. They have a wide moat and a rock-solid balance sheet, and they grow their dividend quickly, too.
Visa's dividend growth via SimplySafeDividends.com
They're a company that you sleep well at night owning.
So there I was, telling myself I was oh-so-clever, trying to scoop up a few more shares with a limit order at $259.50 when the stock was trading around $259.75. "Ha!" I thought, "I'll lower my average cost AND save a quarter per share!"
The stock gods were not amused.
Fast-forward to the end of the week, and Visa is sitting at $267.38, and my limit order is collecting digital dust in the "expired instructions" section of my Schwab brokerage account.
And I'm out almost $8/share if I want in at this price.
Quality dividend growth companies tend to increase in stock price over time because their intrinsic value keeps rising.
And I know this! When we're in it for the long haul with high-quality companies like Visa, $0.25 today is likely a rounding error in 10 years.
What matters most is getting those shares in your portfolio and letting the power of dividend growth and compounding do its thing.
And for those with lots of experience rolling your eyes saying, "Duh!" - yeah, I know. Sometimes, we all need a reminder that we're not as clever as we think and can fall into the trap of trying to outsmart the market.
Investorsunderground.com
They say the market often gives you second and third chances, so there's a high probability we will see Visa in the $250s or lower, but that's not a guarantee, and Visa may never trade there again.
So the next time you're tempted to get cute with limit orders on your long-term, high-quality holdings, remember my $8 lesson and what trying to be cheap cost me.
Please hit reply and let me know if you use limit orders when making long-term stock purchases.
😁THANK YOU to everyone who responded to the last newsletter!!
7 Schwab US Large Cap Growth ETF (SCHG) | $99.91 ~We are selling off SCHG because there's heavy overlap with our (DFUSX) position, accounting for 14% of our net investment portfolio. We are buying more Visa with the funds.
It's not a quote this week, but it's a podcast episode I enjoyed. The We Study Billionaires podcast went deep on Old Dominion (ODFL) and was quite an enjoyable story.
If you're reading this, let me know if you like the week's quote or if you'd rather have one or two podcast episodes or books I'm reading. 😀
🎦If you missed it, the dividend PENNY stock that Warren Buffett's Berkshire-Hathaway bought 262% more of!
🤑Rick Stambaugh from Orange Mountain Financial brings you ‘Grow Retirement Income.' He’s a seasoned pro with over 30 years in trading and a passion for guiding folks to a prosperous retirement.
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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.
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