06-23-2016, 09:58 AM
I started out by doing one larger purchase a month instead of multiple smaller ones. As Rasec mentioned, broker fees will be a factor in deciding how many purchases you make.
It is better to save up and make higher quality purchases instead of being in a hurry and picking up weaker/overpriced stocks. Here are a few common things to pay attention too:
What is the dividend rate? What if your personal minimum/maximum?
Price/Earnings (P/E): less than 20 is a common metric
Dividend/Earnings (payout ratio) less than 60% for non utiility/REIT is common
How many years has the company paid a dividend?
How many years since they last lowered their dividend?
What is their debt situation? Debt rating? How does their Debt/Equity (D/E) compare to their industry?
Perhaps use the Chowder rule: Dividend Rate + 5 year dividend growth rate (commonly want over 12)
How are they growing: Expanding into new markets, new products, buying up other companies?
Over the past 5/10 years, how is their earnings and revenue growing?
Why do you think this company will be strong and viable 50 years from now?
It is better to save up and make higher quality purchases instead of being in a hurry and picking up weaker/overpriced stocks. Here are a few common things to pay attention too:
What is the dividend rate? What if your personal minimum/maximum?
Price/Earnings (P/E): less than 20 is a common metric
Dividend/Earnings (payout ratio) less than 60% for non utiility/REIT is common
How many years has the company paid a dividend?
How many years since they last lowered their dividend?
What is their debt situation? Debt rating? How does their Debt/Equity (D/E) compare to their industry?
Perhaps use the Chowder rule: Dividend Rate + 5 year dividend growth rate (commonly want over 12)
How are they growing: Expanding into new markets, new products, buying up other companies?
Over the past 5/10 years, how is their earnings and revenue growing?
Why do you think this company will be strong and viable 50 years from now?