When market prices float through space, it’s worthwhile remembering this: prices are a qualitative measure, not quantitative. Prices are opinions. Everyone’s got one. They can change with the wind.
But, stock dividends, for example, they’re quantitative. They’re tangible. You can see them enter your account if you pay attention. Trading stocks—a zero-sum game—is not investing. That’s speculation. With most of the world focusing on prices, why wouldn’t you focus on dividends?
We learn at a young age how to make money. How to save. But at some point, after they’ve accumulated a pile of money, some investors begin to treat it like it’s a game. Investing isn’t a game. It’s hard work. It’s a daunting task, even when done well. Anyone can buy stocks. Creating and maintaining wealth when you’re no longer working? That’s not an easy task.
It never ceases to amaze me how investors will load up on one stock—not realizing that their life depends on it. I advise doing the mental math of how many hours of work it would take to replace your largest stock position.
Action Line: Show me the money. That’s what I like for you, my valued reader. Because cold hard cash gives you laser-like focus on the quantitative such as: Income. What amount of income, for example, can your pile of money create for you? How can your pile of cash work for you and not be a lazy bum? Let’s not lose sight of how attractive bonds are. Don’t get caught up on the prices. Focus on income. If you need help building a portfolio that focuses on income, let’s talk. In the meantime, get to know me better by subscribing to my free monthly Survive & Thrive letter.
E.J. Smith - Your Survival Guy
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