Europe Fatigue and Dividends
I have had enough of hearing about Europe and their debt crisis. Actually, I have had enough of watching the impact of constant hope followed by inaction on my portfolio. The stocks in my retirement account go up and then down. They go down some more and then go up again. I simply wish that a decision would be made. It really isn’t that the market seems all that volatile to me, but it feels stuck in a narrow range.
No Trend
Over the past year, the Dow Jones Industrial Average has had a low of 10,404 and a high of 12,876. But if you look at this 2 year chart which I got from Fidelity where I have my retirement accounts, you can see that since August there hasn’t really been a nice trend. Stocks have been up and then back down and up and back down. It truly looks like a roller coaster, and to be be quite frank, I am getting sick of it!
Will today finally bring an end to the European debt news cycle so that we can move on to some other things that might establish some sort of trend in the US stock market. It is hard to make decisions when it feels like you are being beaten around like a crab on the deck of Deadliest Catch!
Comfort from Dividend Stocks
At least I can take comfort in my decision to try to increase my returns from buying more dividend stocks in my retirement account. I added together the dividends that I have gotten so far in the fourth quarter of 2011, and it my highest total in 2 years. In fact, it looks like my goal of $1000 per quarter that I wanted to accomplish in 2012 was too easy to achieve and will be done this quarter since I have 2 more stocks that will be making payments.
In fact, AK Steel (AKS) will be paying out a dividend today. And Seadrill (SDRL) will be paying toward the end of the month on 12/21.
I promised that I would outline some of the changes to my portfolio that I would be making to increase the dividends that I receive. I plan on outlining this in detail over the weekend and posting it on Monday along with my revised goal for 2012.
In the meantime, I suppose that I will sit back and enjoy the news coming out of Europe and try to guess whether stocks will go up or down. It doesn’t really matter if I am wrong since I know that the next day will bring the opposite so we will just be right back where we started.
Readers: Is the constant roller coaster of the market making you nauseous? Is it affecting you at all? Are you a longer term investor who ignores the fluctuations?
On another note, I do have a different 401(k) which now has a match. That money is going into mutual funds, but the match helps guarantee me a profit no matter what happens and the bi-weekly deposits help with dollar cost averaging. So maybe, I shouldn’t be too fatigued after all? If the market plunges next year, it will be good these early investments to buy more shares cheap. After all, I still have 27.5 years before I need to withdrawal.
Have a great weekend!
We had a small investment, but I just had the dividends rolled into the investment. I didn’t watch it too closely, just when I got statements, but the returns over three years have not been that great. I need to learn more about stocks so I can make better decisions.
Melissa recently posted..Debt Free Journey Update #6
Education in the stock market is just like any other type of learning. It does take time and costs a little money along the way.
I know it can be tiring but Europe is seriousy important right now. I read over on Calculated Risk Blog that the US market is more in congruance with Europe than ever before. Basically what happens in Europe markets nearly dictates what happens in US markets.
If the ECB ends up printing money in a QE-like procedure then that will get them out of the immediate crisis by artifically beefing up the IMF bailout fund but that would also devalue the value of the Euro.
If they keep pushing for more austerity then they will continue pushing into a Europe wide recession. Since we export quite a bit to Europe that will slow us down too… not to mention the losses our financial institutions will see if big financial institutions in Europe start falling.
Many US banks “insure” European banks with CDS so if they fall ours will take a big hit too. Global recession is a risk at this point. Brazil, a BRIC state, is already pushing into recession and they are a commodity producing country. Global recession will drive all equities down as well as commodity values.
Dividends are nice and I want more of them but I seriously am concerned about another major leg down in stcoks… which would of course drive many dividend yields higher. It’s a risk yes, but it’s also a preservation of capital which I know you are into.
Brian recently posted..How I’m “Saving” For Retirement
Preservation of capital is important for sure, and I am prepared to do just that. I have always felt that another recession was in the cards, but I guess I was just whining that it is hard to figure out which way the market is going. If a recession and market decline is coming, then I can trade that. It would just be nice to know. All you points are very valid and true. I guess we just see what happens.
The volatility is a reaction and some times over reaction to news around the world. What bothers me is it has very little to do with the companies in question.
krantcents recently posted..Friday Night Links: Boomer or Late Bloomer?
I too am tiring of Europe controlling the markets. I want to invest more but in this volatile market I just can’t bring myself to dump money into stocks.
Sustainable PF recently posted..Living In A Shipping Container
Yeah, it would be nice to have some direction. Nothing wrong with sitting back and waiting for a trend to develop. Part of investing is dealing with emotions so make sure you can sleep at night.
It looks like the market is only tuned to Europe as if no one else exists on this planet. It is starting to get tiring and the worst part is it might take a long time before this is behind us.
BeatingTheIndex recently posted..Eagle Energy Trust: A Dream Come True For Income Investors?
It will take a long time for it to be behind us, but nothing has popped up to interrupt the news cycle. Europe just keeps dragging on. I guess that eventually people will get used to it, like the deflation in Japan.
I’m expecting a European monetary breakup. When that comes, next month, next year, next couple years, don’t know. But it’ll be interesting. In the meantime, I’m not too deep into daily news.
101 Centavos recently posted..Random Dividend Thoughts and Stupid Taxes
A breakup would cause all sorts of change. It is hard to know what the impact might be. It could propel the renminbi (yuan) into a greater worldwide status once the euro is removed from competition with the dollar for reserve currency status. Not that China’s economic might won’t be felt anyway, but a euro demise would hasten the process.
You have to think that the market will basically move sideways for the next few days as the Western world (whose consumers have driven a lot of world expansion) de-leverages. Might as well just sit back and enjoy the ride as you pick up your dividend-payers on the the dips right?
My University Money recently posted..Why I Wish I Started An Internet Business In University
Yes, might as well. I think there is a lot more de-leveraging to go.
Hey I own SeaDrill as well!
At dips I keep buying. But off late, hard to tell what’s is a dip!
Moneycone recently posted..If You Own Mutual Funds Or ETFs, Don’t Ignore This Metric
Don’t you know it. It looks like futures are pointing to a down day today. Does that mean tomorrow will be up?
I pretty much only invest in stocks that have dividends. My favorites are AT&T and Verizon because their dividends are so high.
Oren recently posted..Joseph A. Bank – 65% off Suits and $50 off a $100 Purchase
Those are certainly good dividend payers. I have to wonder about the AT&T business model and dependence on land lines. It will interesting to see if it can manage the transition.