Stock Market Information

So, in our earlier post we covered the very basic part of dividend investing, which included what a dividend is exactly and why it may interest you as an investor. Now we’ll take it a step further and get into some of the strategies and methodologies that income investors employ to earn solid returns through good markets and (like now) bad ones as well.

Finding Dividends

U.S. corporations currently deal out somewhere between $250 to $300 billion dollars worth of dividends annually. This may sound like a tidy sum, and it is, but it’s actually a much smaller part of the entire market, which is valued around $15 trillion. In total, dividends probably make up around 2% of the market’s value, so you may have some searching to do. Listed below are the most popular sectors for dividend-oriented investors:

• Banks: Of course with the recent subprime mess, many financial institutions have had to cut or suspend their dividend payments. Many still remain though, and some banks have assured that their dividends will remain steady (Bank of America, for example). This also means that it’s possible that some of these institutions are oversold, but the risks remain high.
• Utilities: Utilities may not exactly conjure up images of high growth, but recent increases to energy prices have helped to make the sector more profitable. They often have high yields that at the very least keep pace with inflation, so keep an eye on them.
• Consumer Staples: No matter what happens to the market at any given time, there will be products that people have to buy. These include razors, food, beverages, household products like soap, etc. High Yields abound in this sector, and growth is there too if you know where to look.
• Real Estate Investment Trusts: I know, the real estate markets have been clobbered lately and so have many REITs in the process, but plenty are still alive and well. Growth prospects are moderate here, but they’re also not regulated like utilities, so chances for increased profit are available.
• Energy: I don’t think I need to point out why energy has been a lucrative investment over the past years, but oil companies in particular have been a traditional source of growth and income through dividends. Their yields are modest, but growth prospects are much better.

Educating oneself about the stock market before making trades is very important. There are numerous places online where users can learn about the stock market free of cost. There are also some places where users can pay to learn about the stock market. Researching specific stocks as well as industries is one of the most important things to learn before trading.

This site was designed to help users buy and sell stocks so we will therefore discuss the ways people can learn about the stock market including books, forums and other sites of interest. Online forums are all other the internet and these forums can be useful and also dangerous. This is because the freedom on most forums allows just anyone to comment on stocks. Beginners will need to take care in deciding what advice to take when making trades.