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re: Quetion About Buying Stocks For First Time

Posted on 3/20/13 at 10:23 pm to
Posted by ThaBigFella
baton rouge
Member since Apr 2006
2043 posts
Posted on 3/20/13 at 10:23 pm to
Vol I love your posts and your always insightful buy I fully disagree. I mean, I don't see any harm in buying something like McDonald's or Coke or in my case Philip Morris.....a basket of dividend growth blue chips will maybe not outperform the market in the long run, but it will perform just fine if you reinvest the dividends and enjoy dividend growth along the years.....now if you're talking a short term trade, then yes you may get your teeth kicked in
Posted by Vols&Shaft83
Throbbing Member
Member since Dec 2012
69956 posts
Posted on 3/20/13 at 11:16 pm to
I was implying he should grow his financial education before trading single stocks. But I agree.
Posted by Chris Farley
Regulating
Member since Sep 2009
4180 posts
Posted on 3/20/13 at 11:40 pm to
quote:

a basket of dividend growth blue chips will maybe not outperform the market in the long run, but it will perform just fine if you reinvest the dividends and enjoy dividend growth along the years.


Then why not just invest in a basket of index ETFs, take the market return, and limit a lot of risk by not running such a concentrated portfolio? I don't understand why you would essentially add risk to take lower long term returns.
Posted by Vols&Shaft83
Throbbing Member
Member since Dec 2012
69956 posts
Posted on 3/21/13 at 7:06 am to
Let me also add, the reason I suggest mutual funds, index funds, and some ETFs is because I believe 1 of the "blue chip companies" has a higher probability of becoming obsolete than all 500 companies of the S&P becoming obsolete over the next 30-40 years. Especially since the S&P evolves and changes every year. In fact I'm 100% certain of this. And VFINX has a 2% yield, so you also have a dividend growth to enjoy along the way.

When you think in terms of 30 years or more, why pick a few and hope you're right is all I'm saying.

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