Investor Education: Dividend Yield
Dividend yield is a ratio that tells investors the amount of dividends per share a company pays out divided by its current stock price. For example, if XYZ pays a $0.50 quarterly dividend ($2 annualized) to shareholders and it's currently trading at $50 per share, the dividend yield will be calculated as follows:
Annual dividend / Current stock price = Dividend yield $2/$50 = 0.04 = 4%
Learn more about Dividend Yield Here!
Relentless Progress
“Where difficult matters are at stake, the change is best affected by slow but relentless progress…. We should persevere in doing many small things, and eventually they add up.” —Vaclav Smil
Investors that are long the stock market had another rough week. The Dow dropped 4% and is now back down about 20% on the year. The S&P 500 and Nasdaq again lost more as they were down 4.65% and 5.07%, respectively, and both are down more than the Dow on the year as well.
All kinds of investors—experienced, novice, young, old, short, tall—have lost money this year. Many will be enticed to swing for the fences and take risks to get it back as soon as possible. But trying to get rich quickly, or less broke, or make up for losses you wish you didn’t have, is often the easiest way to lose it all.
There’s a tendency in many species, humans included, to want things today. The subset of the (mostly) human species that we call politicians often prey on this desire when speaking with the voting public. Few proclaim a goal of electing them so that they can just leave things in a little better shape than they found them. Instead, they promise the world. Something or everything is always wrong—and they can fix it in no time at all if you’ll just help them get elected.
“I always tell people if you want to know the secret to happiness, I can give it to you in one word: progress. Progress equals happiness.” —Tony Robbins
There is a difference between change and progress. Our politicians change, but people keep complaining about them because they feel no progress is being made.
And in 2022, investment portfolios have changed more than in most years. The questions you want to be thinking about, especially if you’re down this year, are: Am I making progress? Is my portfolio invested in things likely to be higher 5 and 10 years from now? Are my overall financial affairs in order so that I have time to let my investments eventually recover, even if there is more downside from here?
Bear markets are a time for reflection. Mistakes and speculation get punished hard. Diligence and patience, eventually, get rewarded.
“It is true, there is much to be done, and perhaps, you are weak handed; but stick to it steadily, and you will see great effects; for Constant dropping wears away stones; and by diligence and patience the mouse ate in two the cable; and little strokes fell great oaks.” —Ben Franklin
“[Albert Einstein] said, ‘The most powerful force in the universe is compound interest.’ But that’s not all he said about compound interest. He not only said that it’s the most powerful force in the universe, he said it’s the greatest mathematical discovery of all time. He said it’s the eighth wonder of the world. And he said that those who understand it get paid by it and those who don’t pay for it. He said all these things, Albert Einstein, about compound interest. Now what’s a good working definition of compound interest? I will propose one. You can have your own, but this is mine. I say compound interest is dogged incremental constant progress over a very long time frame…. The most powerful force that could be potentially harnessed is dogged incremental constant progress over a very long time frame.” —Peter Kaufman
Windy City RoundUp Conference in Chicago
Over two days in October, investors can harness top stocks for their portfolios. They’ll meet with executive management teams from approximately 50-plus microcap companies across a wide variety of industries and gain an understanding into the key value drivers and potential trends for 2023.
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