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  • So, let's talk about dividend

  • investing for income.

  • What is dividend investment,

  • and does it make sense?

  • See, the other day, I got a comment

  • from one of you.

  • His name is Jose Silva

  • and he said,

  • "How do I find less than

  • ten dollars dividend paying

  • stocks that I can keep forever?"

  • So,

  • what does this mean when he's

  • talking about dividend stocks?

  • Let me show you what this means.

  • So,

  • first of all,

  • I'd did

  • Google the top

  • dividend stocks to buy.

  • So, when you go to Google,

  • best dividend stocks for 2019,

  • one of the articles that is coming

  • up is an article from

  • Motley Fool.

  • So, I saw this article,

  • which is exactly a day old,

  • and they say: Here are the top

  • dividend stocks to buy right

  • now.

  • And they're talking about Home Depot,

  • Six Flags,

  • and General Motors.

  • So, let's take a look at this.

  • As we're bringing them up here,

  • let's type in HD

  • for Home Depot,

  • and as it comes up here,

  • you will see that Home Depot is right

  • now trading at $189. And

  • you see that there is a forward

  • dividend. So, what does this mean?

  • It means that stocks that are

  • being publicly traded often pay

  • a dividend per one share

  • that you own. So,

  • if right now, you had one share

  • of Home Depot,

  • you would get $5.44.

  • Now, how often is this dividend being

  • paid? It is paid four times

  • a year. There are companies who are paying

  • it once a month.

  • Most companies are paying it quarterly,

  • four times a year.

  • So, the idea of dividend

  • investment...

  • Some people say,

  • you know. Just buy stocks.

  • They're not giving you dividends.

  • As you can see right now,

  • it's not that good.

  • It's 2.87%,

  • but it

  • is better than putting your money in a C.D.,

  • right? And this is why some people

  • say invest in dividend

  • stocks and then you're getting paid

  • quarterly.

  • In fact, I read an article that says

  • how to make sure that dividend stocks

  • are paying all your bills.

  • Well, first of all,

  • let's think about it.

  • If you are buying 100

  • shares of Home Depot,

  • and let's actually go back,

  • and take

  • a look at Home Depot.

  • And right now,

  • it's at $189.

  • And let's say...

  • Let's go here...

  • A few weeks ago....

  • Let's say it was trading at around $200.

  • So,

  • if you would buy a 100

  • of Home Depot,

  • you would have to tie up

  • $20,000,

  • and for this,

  • you're getting $544

  • per year.

  • $20,000 tied up,

  • you get $544 so

  • that's two point...

  • What is it? 2.8% or

  • something like this?

  • Now, here's the problem.

  • The problem is if the stock

  • goes only down by $5,

  • you give up

  • all your dividends.

  • And if you look at Home Depot right now,

  • it went from a high of $212,

  • all the way down to a low

  • of $158.

  • That is

  • 25%.

  • So, dividend stocks

  • are only good if they

  • keep going up.

  • But take a look here at Home Depot.

  • It has not been going up.

  • You see that Home Depot has

  • been going sideways

  • and hovering between $180

  • and $190, and

  • this is the challenge.

  • So, I think that dividend

  • income is really,

  • really tricky because you're betting

  • on the stock going up.

  • When the stock goes down,

  • you give up all your incomes.

  • Now, let's take a look at the other dividend

  • stocks that Motley Fool mentions

  • in their article.

  • Let's take a look at Six Flags Entertainment.

  • Six Flags,

  • the symbol is SIX.

  • This is another one that they're recommending.

  • Now, here, as you can see,

  • the yield is a little bit higher.

  • 6.77%, but

  • let's take a look at what happened here

  • with Six Flags.

  • As you can see,

  • even this year

  • has been decreasing tremendously.

  • I mean, Six Flags was trading at $72

  • at some point. And right now,

  • it is trading at $48.

  • Now let's see...

  • So, June last year...

  • So, not quite a year ago,

  • it was at $71

  • and now at $48. So,

  • if you had bought Six Flags

  • in order to get a dividend of 6%,

  • my gosh... You would have lost...

  • Let's quickly take a look

  • at this.

  • You would have lost 36%.

  • Now, let's just do a very last

  • quick comparison here because

  • the other stock that they're recommending is General

  • Motors. General Motors?

  • Really?

  • Let's see. Are they paying high interest?

  • And again, this article that I'm showing

  • you right now is a day old.

  • It's from yesterday.

  • So, Motley Fool?

  • I don't know guys.

  • Not too impressed.

  • So, here, the yield is 4.1%

  • and if you look at General Motors,

  • we'll probably see a very similar picture,

  • where we see that General Motors...

  • No. Yeah...

  • This looks pretty ugly.

  • So,

  • what does this mean for dividend

  • investing?

  • So, for me personally,

  • I don't think that dividend

  • investing is a

  • good approach at all.

  • Now is it better than putting

  • money in a C.D?

  • No! Not even that.

  • Because if you think about it,

  • if you put money into a C.D.

  • or in the money market,

  • at least you're not losing any

  • money. As you have seen

  • with these dividend stocks,

  • they are

  • whipping all over the place.

  • And for the past few months,

  • they've gone one direction,

  • and this is down.

  • Now, I really,

  • really believe that dividend trading

  • is extremely risky.

  • Some people say it's safe.

  • I don't think it is.

  • So, what should you do instead?

  • Instead learn how to

  • trade stocks

  • and take advantage of the small moves.

  • The cool thing is when trading,

  • you can participate

  • when the market is going up.

  • You can participate when the market is going

  • down.

  • And there's always these small

  • moves in between while the market

  • is in a transition.

  • So, right now as I'm recording this,

  • the markets have been sideways for

  • most of March.

  • It is now the end of March.

  • Today's March 27.

  • And yet,

  • as you can see, in my portfolio,

  • I have stocks where I'm betting

  • on some stocks that are going up,

  • some stocks that are going down,

  • and this is the way to go.

  • Because for me personally,

  • my goal when trading stocks

  • is, I want to make sure that I'm making

  • at least 60% per

  • year.

  • Most of the stocks that I'm trading

  • are at around 70%,

  • 80% so why would you

  • piddle around

  • with dividend stocks that make you

  • 2% or 4% if

  • there are ways how you can make

  • 60%, 70%,

  • or 80%? And if you're interested

  • in learning how exactly I do this,

  • go to mytradingroutine.com.

  • There is a quick video.

  • 35-minutes that shows you

  • exactly what I do

  • or feel free to come

  • to one of our boot camps that

  • are several hours.

  • They're free. They're on a Saturday

  • and you can find out more about

  • the boot camps on bootcamp.rockwelltrading.com.

  • bootcamp.rockwelltrading.com.

  • This is where you'll see the dates

  • and locations.

  • The next ones are coming up in Houston.

  • The last ones were in California

  • I believe we'll also go back to Florida.

  • So, we'll update the dates

  • and locations there all the time.

  • So, was this helpful?

  • Does this help of knowing what

  • dividend stocks are

  • and whether it's worth investing

  • it? If this was helpful,

  • make sure that you leave a comment,

  • say "yes".

  • Give me a thumbs up.

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  • I hope that you enjoyed watching

  • this show as much as I enjoyed