Day by day we inch closer to hitting and breaching the debt ceiling. Today, investors and traders reacted negatively to that possibility, selling off stocks and moving money into “safer” assets. However, even though there has been a pullback in the market in recent days and weeks, the reaction from investors has not been drastic, suggesting that most of Wall Street does not yet believe our policymakers in Washington would be crazy enough to breach the debt ceiling, even if they cannot come to a compromise to end the partial government shutdown.Stocks on the Rise
Among the few stocks that rose into positive territory today were: Soethby’s (BID), following the news that activist investor Daniel Loeb upped his stake in the company and is lobbying for the CEO’s resignation; PVH Corp. (PVH), after it announced the sale of G.H. Bass and boosted its outlook; and Agrium (AGU), following its CEO resignation announcement.
Shares of Eli Lilly (LLY) retreated in trading today after the company reaffirmed its outlook. Additionally, Domino’s Pizza (DPZ) and Bank of New York (BK) shares were lower following Wall Street analysts’ downgrades.
Be sure to check the Dividend Daily for all the latest earnings reports, analyst moves, and much more.Dividend Investing Is An Effective Strategy for All Investors
Dividend investors typically seek one of two outcomes from their investments: consistent dividend payouts that are used for income in retirement, or consistent dividend payouts that can be reinvested and compounded over time to help build up a nice financial safety net.
Typically when people think of dividend investing they picture the first scenario (income). These older investors who are more focused on a consistent dividend income are much less concerned with the capital gains returns that get much of the press in the financial media. As such, this sort of strategy is seen by many individuals as a boring way to invest in the stock market, especially when we still remember the heyday of stock picking in the late ’90s when capital gains could double within a week. But how did that work out in the end?
Too often the thought of the second goal is put on the backburner for investors trying to build wealth. For these individuals who want to see big returns over time, they think they need to hit it big with a large run up in share price appreciation from a portfolio of stocks like Netflix, Tesla, or LinkedIn (to give a few recent examples). What these investors fail to realize is that through a proper dividend investing strategy, you can take advantage of both share price appreciation and the reinvestment of consistent dividend payouts to build up wealth, without the risks involved with growth stocks.Start Early if You Can, but It’s Never Too Late
It does not matter if you are 25 or 85, you can take advantage of dividend investing to shape your savings and wealth building goals, whatever they might be. Whether you want to start early and invest to ensure you have a financial safety net in your golden years, or want to see those monthly and quarterly dividend income checks come in consistently, dividend investing can be utilized, even if it does not get much attention by the media and financial analysts. Always remember that.
Thanks for reading! Be sure to check us out on Twitter @dividenddotcom. We will see you tomorrow.
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