The Toronto market is down today. It's not as far down as it has been in recent months but it is down. I am not concerned. A lot of the stock that I own today was purchased some two decades ago. Some of these old holds have to be off their highs by 50% or more before I begin to see red.
The gain at the top of the column on the left represents one of these old holds. It has delivered a steady stream of dividends for decades. I have taken out more money in annual dividend payments than I invested in the stock originally. And, as it has gained in value with the passing years, I have more money in it today than I did at its purchase. Stocks like this form a bulwark against an old, seasoned portfolio falling into the red.
The two stocks at the bottom are recent additions to my portfolio. The second from the bottom was added when the stock, a pipeline, got so cheap I could not resist buying it. With a dividend greater than seven percent, this stock is a gem.
The bottom stock is one that I bought just days ago. I am playing with the dividend capture strategy for an upcoming post. My gut feeling is that this strategy doesn't work. If it did, everyone would be doing it and everyone isn't.
The ex-date for this stock is this Friday and last Friday it looked to be a stock on the upswing. And not only was it gaining value but its entire group, in this case telecoms, was in recovery mode. With all the relevant boxes checked, I bought a few hundred shares.
What lessons do I take from the above? Lots of time spent holding a stock that is slowly climbing in value is time well spent. And although it is next to impossible to time the market, being lucky and buying a stock at the right time is a huge bonus. When you manage to time the market, admittedly after the fact, smile and go with the flow. You may have a gem worth holding for years.
Never forget: compounding is your friend. And time is the friend of compounding.
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