The vast majority of people only know how to buy shares and sell them when the price rises above the purchase price. However, the price in the market has 3 directions.
1. Climbs
2. Floats sideways
3. Drops
It means you only make money 33% of the time. You spend the other 66% waiting while the price goes nowhere or drops. Therefore, you must learn how to make money when one of the other options other than a price increase happens.
The market, in general, has been falling in recent months. So most people have seen their accounts plummet. But today, I’m going to show you how you can make money regardless of the price direction of your investments.
Be part of the disruption and get free stocks when you open a Robinhood account. Also, enjoy your fractional shares and commission FREE!
Using the strategy of catching dividends, I invested in Intel Corporation (INTC).
Intel company had an ex-dividend date of May 5, 22. Two days prior, I invested $4,540. I made a purchase of 100 shares for $45.40.
Once the purchase went through, I quickly sold an option expiring May 6, 22, for a credit of $38.
Since then, Intel’s price has dropped and remained below $45. Typically, people are left waiting for the price to recover, looking at their accounts stagnant for weeks or months.
On May 6, 22, as Intel’s price did not reach $46 or more, the option lost most of its value. So I did what is called a ‘roll.’
I bought that option for $3 and sold the option expiring May 13, 22, for a credit of $54, giving me a net income of $51.
Similarly, the price of Intel did not recover and remained below $45. Repeating the process, on May 13, 22, the option lost all its value again. I bought the option for $1 and sold the one expiring May 20, 22, for $26. For another $25 net credit.
On May 20, 22, the price still did not rise to $45 or more. Unfortunately, I couldn’t watch the market that day, so the option expired and died, losing its value.
With Fundrise, you can become a digital landlord anywhere in the United States without the hassle.
Starting the week of May 23, 22, I sold a new option expiring May 27, 22, for a $5 credit. Likewise, the price of Intel did not recover, so on May 27, 22, I bought the option for $1 and sold a new one expiring on June 3, 22, for $26, for another net credit of $25.
Since I held the shares on the ex-dividend date of May 5, 22, I received a cash payment of $36.50 via dividend on June 1, 22.
Arrived on June 3, 22, the price closed at $43.39, for which the option expired worthless. But, once again, I couldn’t watch the market on this day, so I didn’t do another roll-over.
For 1 whole month, the price of Intel has remained below the purchase price. However, I have generated a total of $184.50 in cash. Subtracting the $5 I have spent on option purchases, I have a net profit of $179.50 or a 4% for the month.
I still hold the 100 stocks on which I will continue to sell options at or above the purchase price.
With Robinhood, you can get cash dividends from well-known and established companies.
As you can see, a person with no knowledge of the market would be holding their shares and would have a loss on paper of $201 and nothing more. That person is possibly frustrated with the market because it hasn’t gone up. But we learn to make money in the market no matter how it goes; we make cash while we wait for the recovery.
I want to teach you these strategies and others for free. So I am working on a YouTube channel in which I will teach you everything I know through videos. The channel will be Investi for Spanish-speaking individuals and InvestCity for English-speaking people. We estimate its opening for the end of summer for Investi and early next year for InvestCity.
Stay tuned, and we will provide you with more information soon.
Now, begin your Road to Wealth!
Leave your comment below. If you liked it, pay it forward. Please share it on social media and help others become successful as well. Your success will be the result of two things: Knowledge and Action.
DISCLAIMER: Please read our disclosure policy here. This post contains affiliate links, and I earn from qualifying purchases at no cost to you. There is a very high degree of risk involved in trading. Past results are not indicative of future returns. Road-to-wealth.com and all individuals affiliated with this site assume no responsibilities for your trading and investment results. The indicators, strategies, columns, articles, and other features are for educational purposes only and should not be construed as investment advice. Information for any trading observations is obtained from sources believed to be reliable. Still, we do not warrant its completeness or accuracy or warrant any results from the use of the information. Your use of the trading observations is entirely at your own risk, and it is your sole responsibility to evaluate the information’s accuracy, completeness, and usefulness. You must assess the risk of any trade with your broker and make your own independent decisions regarding any securities mentioned herein.
Friends, Colleagues, and even Family Members ask me, “Joey, Why are you so committed to investing?”
It is a question that makes me both happy but also sad.
Happy because everyone around me sees my commitment to my financials. But also Sad because they still don’t understand what moves me.
My goal is that by the end of this article, you will understand my point of view towards the future and take action to help yourself along the way.
I got involved in the markets during the 2008-2009 crash. Believe me or not, it was one of the best times to get involved in the markets because it quickly taught me that it was not easy, especially if you were a trader more than an investor.
Although trading is exciting, it takes time to analyze the markets daily. Try to find what is moving and catch the perfect windows to jump in and out. Unfortunately, it is an ideal recipe for burning out quickly.
On the other hand, let’s say that I’m lazy. I don’t want to be stuck to my computer all day looking for opportunities. So use that time in other productive activities while the markets do their thing, and you still get paid for being patient.
Be part of the disruption and get free stocks when you open a Robinhood account. Also, enjoy your fractional shares and commission FREE!
To answer the first question, “why am I so committed,” is because I realized the earlier you begin investing, the sooner you can reach your goal and the less time you have to spend working for someone else. Understand that I said “Investing” and not “Trading.”
Most financial advisors teach individuals about the 4% rule at retirement. Unfortunately, that is a horrible strategy because it involves withdrawing 4% of your capital to live and cover expenses every year. As a result, most people will have little to no money towards the end of their years.
It puts a severe amount of pressure on their kids and family members. Now, they have to cover their expenses and yours as well.
Who wants to put that pressure on their kids?
I’m pretty sure no one does. That is why I have an alternate strategy that will work wonders for everyone.
The idea is to invest in assets that will cash flow enough money to cover your expenses while leaving your capital intact. Then, when we die, our kids or family members can inherit that capital (investments) and make their lives easier.
With Fundrise, you can become a digital landlord anywhere in the United States without the hassle.
How it works:
Although there are several cash flow assets, we will concentrate on dividend-paying stocks and ETFs.
Why?
Because when you invest in dividend-paying stocks and ETFs, you have several ways of making money. The most common one is capital gains as time passes. If they increase their dividends with time, your cash flow also increases. You can also learn how to sell covered calls and other income strategies to bring even more money each month.
While all of this is happening, you are not depleting your capital. Meaning your net worth will never decrease. On the contrary, you can keep increasing your net worth while living the life you want.
So, What happens if you keep postponing your investing?
In simple words, you won’t have enough cash flow to retire comfortably.
One of two things happen:
1. You can’t retire; hence, keep working longer.
2. You have to increase the money you invest to catch up.
With Robinhood you can get cash dividends from well-known and established companies like Coca-Cola (KO).
Let’s look at an example:
Mimi and Joey both begin with a $3,000 initial investment. After that, both invest $300 monthly and receive an average annual return of 8.5%. Mimi is 20 years old, while Joey is 30 years old.
In 10 years, they both have $60,826.
In 20 years, they both have $190,935.
In 30 years, they both have $485,107.
And this is where things take a turn. Joey was 30 when he began investing and is now 60 years old and ready to retire.
Meanwhile, Mimi has another 10 years of compounding before she turns 60 years old, which will end up with a portfolio worth $1,150,226.
Who will have a better life using the 4% rule?
If they both use the 4% rule at retirement, Joey will be receiving $19,404 from his withdrawals. On the other hand, Mimi will be receiving $46,009 for her withdrawals.
You can say that Mimi will have a better life because she will receive more than double what Joey will receive. He will have to figure out how to live on $19,404 a year. However, both of them will run out of money by age 85.
Why?
Because regardless of how big your portfolio is, if you withdraw 4%, you will deplete your account in 25 years.
Just do the math:
Joey – $19,404 * 25 years = $485,100
Mimi – $46,009 * 25 years = $1,150,225
In the end, neither one will have anything to give to their kids, and if they live past their 85 birthday, their families will have to support them for the rest of their lives.
From the comfort of your home, invest anywhere in the united states with Fundrise.
What if they cash flow instead of withdrawing capital?
Now, this is where my strategy beats the financial advisors. Instead of withdrawing capital, we can build a dividend-paying stock and ETFs portfolio. The investments can be paying 3%-4% today, but if they increase their dividend payouts yearly, by the time you are 60 years old, you could be receiving dividend payouts well above 6%-8%.
Using this conservative estimate, Joey could receive anywhere between $29,106 to $38,808 in dividends. But, of course, it could be higher if Joey learns how to sell covered calls or other income strategies.
As for Mimi, she could receive between $69,013 to $92,018 in dividends. But, again, it could be higher if she learns the strategies previously mentioned.
I think both of them could live comfortably with those amounts, and the best part is they will never run out of money. Their portfolios will remain the same or even increase. Then, when their time is up, and they move on to a better place, their families will inherit their money, or they could give their money to charity.
It is your money, so do with it what you feel is the right thing to do.
The sooner you begin, the sooner you will reach your goals.
Concentrate on cash flowing assets instead of accumulating money to withdraw in retirement
Teach your kids and family members, so they too have a better life
The 4% rule is widespread; however, it is flawed
The more you postpone investing, the more money you will have to invest in catching up.
Begin your investing journey today
Note:
If Joey wants to have the same amount as Mimi by age 60, he will have to invest $750 instead of $300. That leaves Joey with $450 less each paycheck. So don’t be like Joey. Start now!
Now, begin your Road to Wealth!
Leave your comment below. If you liked it, pay it forward. Please share it on social media and help others become successful as well. Your success will be the result of two things: Knowledge and Action.
If you are not receiving dividends, you are missing out!
DISCLAIMER: Please read our disclosure policy here. This post contains affiliate links, and I earn from qualifying purchases at no cost to you. There is a very high degree of risk involved in trading. Past results are not indicative of future returns. Road-to-wealth.com and all individuals affiliated with this site assume no responsibilities for your trading and investment results. The indicators, strategies, columns, articles, and other features are for educational purposes only and should not be construed as investment advice. Information for any trading observations is obtained from sources believed to be reliable. Still, we do not warrant its completeness or accuracy or warrant any results from the use of the information. Your use of the trading observations is entirely at your own risk, and it is your sole responsibility to evaluate the information’s accuracy, completeness, and usefulness. You must assess the risk of any trade with your broker and make your own independent decisions regarding any securities mentioned herein.
On the famous Friday the 13th, I was scrolling my Twitter account. I felt like talking to people and answering my opinion on various investment issues and the market in general.
I saw a post (I’m not going to mention names because I didn’t ask for permission) where he mentioned covered calls, one of his primary sources of income through his investment portfolio.
Among the comments, there was one that caught my attention and said:
“I’m still learning. I have a $50 call on Verizon ($VZ) which expires in June of next year. Is there a better way to do this than buy and wait?”
I answered:
“Yes. Sell weekly or monthly covered calls. You’ll get income every month apart from dividends every three months (Verizon pays quarterly dividends). Reinvest profits. A call that expires in a year freezes your money.”
He tells me:
“Could you explain a covered call to me like I’m 6 years old? I understand calls and puts perfectly. I don’t understand anything beyond that. So I did that option really to learn and because it was so cheap. So I thought, why not?
I want to say I congratulate you and Thank you very much.
I congratulate you because not many dare to accept that they still do not have the necessary knowledge and are afraid to ask for help, especially in public, as is the Twitter network.
Thank you very much because I just got back from vacation from the island of Puerto Rico and I wasn’t sure what to write. You allow me to help you and others in a similar learning position.
Let’s do it this way first, I’ll give an example of a child investor, then I’ll cover what a covered call is, its risks and benefits, and I’ll finish with two real-life examples that I’m actively managing.
Key takeaways:
* What is a ‘covered call’?
* Risks of this strategy
* Benefits of this strategy
* Real examples
Be part of the disruption and get free stocks when you open a Robinhood account. Also, enjoy your fractional shares and commission FREE!
The Small Investor
You’re 6 years old, and you buy 100 hot-wheels cars for $2. However, you want to sell them in the future at a higher price. A ‘covered call‘ gives you the option to sell them at a higher price in the future while earning you income while keeping the cars in your possession.
Therefore, you sell the option to Juanito to buy the cars from you for $2.50 if the cars are worth $2.50 or more in the future. Juanito pays you a credit, let’s say $0.50, for having the opportunity to buy those cars.
At a stipulated date in the future, say a month from now, one of two things will happen.
1. Cars are worth $2.50 or more. Juanito returns to you to buy the cars. He takes your cars and pays you the $2.50. You keep the $0.50 he paid you for the contract and receive the $2.50 per car in cash.
You have the cash and credit to go back and make another investment. You generated a profit of $0.50 per car ($2.50 sale price – $2 cost) plus the $0.50 credit.
2. Cars have not yet increased in value above $2.50. The contract expires. Since it is not worth more than $2.50, Juanito will not want to exercise his contract since he can get the cars at a lower price. Juanito loses $0.50 that you keep for yourself.
So you keep the $0.50 contract and keep your cars in your possession. It allows you to make a new contract for the next month, generating more income while you continue to reduce the cost of your cars.
From the comfort of your home, invest anywhere in the united states with Fundrise.
What is a ‘covered call’?
It is an income strategy that helps investors generate income in addition to dividends (if the company pays dividends) and capital gains on the stocks or ETFs that you already manage in your portfolio.
Risks of ‘covered calls’
There are two types of risks:
1. The most considerable risk we incur is that we limit our profits on price appreciation.
For example, we buy 100 shares at $45 and sell a call at $50. We limit our earnings to $5 per share ($50 – $45) plus the credit we receive. If the stock rises above $50, the person who bought the call will exercise their option to buy $50 from us and sell it at the current market price.
2. The other type of risk is if the share price falls too low from where we buy because the further the price is from our effective cost, the credit we receive also decreases.
Benefits of ‘covered calls’
1. Selling ‘covered calls’ provides weekly or monthly income depending on the company. Some companies, like Verizon, sell weekly options. Others, like MPLX LP, sell options on a month-to-month basis.
2. Regardless of what price does after selling a covered call, the credit we receive is ours to do with as we please.
Buy whole shares or fractional shares of your favorite stocks, whether Tesla (TSLA) or any other company, commission-free with Robinhood.
Possible results
When we sell ‘covered calls,’ there are 2 possibilities:
1. The stock price rises more than the price established by our sale. At this point, the buyer is very likely to exercise his option and take our shares. Then, automatically, the equivalent of the money appears in our account as cash, and our shares disappear.
In this example, we realize capital gains plus any credit we have received. Now we start looking for another investment to repeat the process.
2. The share price remains below the established price by our sale. At this point, the option loses most or all of its value, generating our credit income, and we keep our shares intact so we can repeat the process.
In this example, we have 2 options:
a. We can wait for the option to expire and go up into the options heaven. It happens on Fridays, either weekly or monthly depending on the availability of the options. Then, when the market opens the following Monday after the expiration, we go back to sell another call with a new expiration date in the future.
b. We can do what is called a ‘roll over’ of the position, which means that we buy/close the current position before it expires for a low price between $1 to $5 and sell/open a new position for a credit to a new date in the future.
As an investor, it is up to you to decide which options to execute. It is your portfolio, and you must manage it your way. Both options are feasible.
Real examples:
Before we get into the examples, there are 2 requirements for this to work.
1. You must be authorized to buy and sell options.
2. You must be able to buy at least 100 shares of the company of your interest.
Each option consists of 100 shares. Therefore, if you do not have at least 100 shares in your portfolio, you cannot sell options contracts against that position. The part that refers to ‘covered’ means that your 100 shares are collateral for that position.
With Fundrise, you can become a digital landlord anywhere in the United States without the hassle.
MPLX LP ($MPLX)
1. The ex-dividend date for MPLX LP ($MPLX) was May 5, 22. If we wanted to receive its dividend, we had to buy the shares on May 4. That’s precisely what I did.
On May 4th, I bought 100 shares at $33 for an investment of $3,300. I sold the $33 call expiring May 20, 22, for a $40 credit.
It left me with two options:
1) the price closes below $33, and I keep the $40 credit and the shares to receive the $70 dividend ($0.70 dividend * 100 shares). By keeping the shares, I could continue to sell covered calls in the future.
2) the price closes above $33, and my shares get assigned to the person who bought my call. So I had $3,300 deposited into my account, and my shares disappeared.
The second option was what happened.
For a couple of hours of holding the stock, I received a $40 credit. After that, the shares disappeared, and my $3,300 returned to my account as cash. It left me with $3,340 to repeat the process.
Like $MPLX, Intel Corporation had an ex-dividend date of May 5, but the difference is that $INTC has options available weekly.
So on May 3rd, I bought 100 shares for $45.40 for an investment of $4,540. I sold the call expiring on May 6 at $46 for a $38 credit.
Since the price of $INTC was below $46 on May 6, the option’s value lost the vast majority of its value, falling to $3. Therefore, I decided to roll over that position before the end of the day, buying the position for $3 and selling/opening a new position for $54 credit expiring May 13.
The price of $INTC is down, with the rest of the market hovering around $43.64 at yesterday’s close. Therefore, I did another ‘rollover,’ closing the position for $2 and selling/opening another position expiring on May 20th for a credit of $27.
I currently have a loss in the value of $INTC shares of ($176). However, I have received $114 in credits in two weeks. Here is the breakdown:
Credit: $38
Debit: $3
Credit: $54
Debit: $2
Credit: $27
Adding the credits ($119) and subtracting the debits ($5) gives us $114. Add to this the dividend of $36.50 ($0.365 dividend * 100 shares) that I will receive on June 1 since I held the shares as of May 5, and we have a total of $150.50 ($114 + $36.50).
I will keep doing this process until, in the future, the price of $INTC recovers to $46 or higher. Then, my shares get assigned to someone else, giving me my money back in the form of cash and allowing me to start the process with a new position either at $INTC or another company.
Which Oil Stock Is A Better Buy? Exxon Mobil (XOM) or Enbridge (ENB)
Note: We have several things to keep in mind.
1. If we want to keep our shares, depending on the price recovers, we can sell ‘covered calls’ at higher prices like $48, $50, etc. Not only does this continue to leave us weekly or monthly income through credits, but we also ensure more significant capital gains.
2. If the stock price continues to decline with the market, two things can happen:
a. Credits decrease if we continue to sell covered calls at the same price we started.
b. We are forced to sell covered calls at lower prices than initially started. It decreases the capital gain when shares get assigned to someone else. However, the credits must be higher since we are approaching the current share price.
I hope this can help you understand and learn other ways to make money in the market. If you want to read from other sources, click on this Investopedia link.
Now, begin your Road to Wealth!
Leave your comment below. If you liked it, pay it forward. Please share it on social media and help others become successful as well. Your success will be the result of two things: Knowledge and Action.
DISCLAIMER: Please read our disclosure policy here. This post contains affiliate links, and I earn from qualifying purchases at no cost to you. There is a very high degree of risk involved in trading. Past results are not indicative of future returns. Road-to-wealth.com and all individuals affiliated with this site assume no responsibilities for your trading and investment results. The indicators, strategies, columns, articles, and other features are for educational purposes only and should not be construed as investment advice. Information for any trading observations is obtained from sources believed to be reliable. Still, we do not warrant its completeness or accuracy or warrant any results from the use of the information. Your use of the trading observations is entirely at your own risk, and it is your sole responsibility to evaluate the information’s accuracy, completeness, and usefulness. You must assess the risk of any trade with your broker and make your own independent decisions regarding any securities mentioned herein.
Do you use AT&T (T) as your cell phone provider? How long have you used it as your provider? A long time probably, since AT&T is a behemoth of a company. Founded in 1983 and currently holds 230,000 employees. It’s as close to a dinosaur as you may think since it has been around forever.
Verizon Communications (VZ) is the only telecom service bigger than AT&T, with a market cap of $218.48 billion, and was founded in 1983 as well. AT&T’s market cap is $176.95 billion. Closing in on (T) is T-mobile US (TMUS), with a market cap of $150.59 billion.
AT&T will spin off a part of their business (WarnerMedia) and merge it with Discovery Inc (DISCA). Expect the merger to close out by mid-2022. It’s preferable to wait for the completion of the merge and see how other investors react to the price. It is a cheap stock looking like a bargain, but it could get “more affordable,” if you know what I mean.
Netflix (NFLX) has returned over 450% over the last 5 years.
Their 5YR P/E is currently at 11.78, making it very attractive and hinting at undervalued or discounted prices. However, return on investment (ROI), assets (ROA), and equity (ROE) are all subpar, with a return of under 2% on all of them. Big red flag for me.
An eye-popping dividend at 8.5%, which makes many investors salivate. However, we can expect a cut next year once the merger is complete with high certainty. Also, the dividend paid takes about 60% of the Free Cash Flow (FCF), which is not good if you have debt or are trying to grow the business. Currently, a total of $15 Billion is paid off in dividends by the $25 Billion of FCF. That leaves (T) with only $10 Billion of FCF to pay debt and grow the company.
To make matters worse, their FCF is $23.44 billion. As a rule of thumb, we can multiply that amount by 5 (5YR projection), and we get a total of $117.2 billion. We would love to see their debt under $117 billion. However, their total long-term debt is sitting at an outstanding $284.2 billion, which more than doubles our estimated numbers. It means that (T) has too much debt relative to their free cash on hand.
Understand that FCF is critical because you can do many great things to help your company when you have free cash. Things like paying down debt, buying back shares, reinvesting in the company, making acquisitions, or paying dividends. As a result, the excellent use of FCF will be more appealing to shareholders than paying a hefty dividend while burying themselves in debt. Just think about it, is the bank willing to lend money to the guy with little to no debt or the guy that makes $50K a year but owes over $200K?
Be a landlord anywhere in the United States, without the hassle.
Their revenue has grown slowly over the last 5 years. I like that. It is preferable to see slow and steady growth than a chart that looks like a cardiogram with random spikes. When reality sets in, those spikes are always followed by crashes. My only concern is that although they have acquired many smaller companies, their revenue growth has not shown much improvement.
Following that, their Net Income has shrunk for the last 5 years from $12 billion in 2017 to $1 billion in 2021. Another reason for concern besides their shrinking income is the outstanding shares have gone up from 6.1 billion to 7.1 billion. We want the outstanding shares to shrink and net income to grow. But, just like Santa Claus got it backward when I asked for a lean body and a fat wallet, AT&T got confused as well and had it all backward.
Not all is bad news with (T). They have grown their FCF from $15 billion to $28 billion. The average FCF for the last 5 years is about $23.4 billion. Estimating this average can be kept for the next 20 years, we can calculate a market cap of about $468 billion. In the beginning, we said the current market cap is $176.95 billion. Our numbers suggest that this metric undervalues it.
Game Stop (GME) the meme stock that ran over 4,700% during the pandemic.
Summary:
(T)’s good points: Low P/E, big dividend (suitable for investors looking for cash flow), slow but steady revenue growth, slow and steady FCF growth, and “undervalued” per FCF metric.
(T)’s bad points: Not sure what to expect from the spin-off merger as far as price action, meager returns on ROI, ROA & ROE. There is a high probability of seeing a cut on the dividend, and their debt is too high. Revenue has not grown much despite their acquisitions. Net income is shrinking, and outstanding shares are rising.
Right now (T) has a lot of work to do. The negative points about the company outweigh the positive. This is only a starting point, so ensure you research and analyze before investing. I believe AT&T has to implement better use of their FCF, lower their debt, generate better returns for their shareholders or they will be painfully looking at their market value fall into a quiet and deathly take over. Therefore, we will only trade (T) with a dividend catch strategy. The only way to consider a long-term position is if the price falls below $20.
Now, begin your Road to Wealth!
Leave your comment below. If you liked it, pay it forward. Please share it on social media and help others become successful as well. Your success will be the result of two things: Knowledge and Action.
From the comfort of your home, invest anywhere in the united states with Fundrise.
DISCLAIMER: Please read our disclosure policy here. This post contains affiliate links, and I earn from qualifying purchases at no cost to you. There is a very high degree of risk involved in trading. Past results are not indicative of future returns. Road-to-wealth.com and all individuals affiliated with this site assume no responsibilities for your trading and investment results. The indicators, strategies, columns, articles, and other features are for educational purposes only and should not be construed as investment advice. Information for any trading observations is obtained from sources believed to be reliable. Still, we do not warrant its completeness or accuracy or warrant any results from the use of the information. Your use of the trading observations is entirely at your own risk, and it is your sole responsibility to evaluate the information’s accuracy, completeness, and usefulness. You must assess the risk of any trade with your broker and make your own independent decisions regarding any securities mentioned herein.
Los principales jugadores son (MO) Altria Group Inc, (PM) Phillip Morris International Inc y (BTI) British American Tobacco. Cubriremos (MO) y (PM) en otro artÃculo; y nos concentraremos en (BTI) British American Tobacco.
Obtenga acciones gratis cuando abres una cuenta con Robinhood.
El negocio de (BTI) British American Tobacco se ha mantenido estable a lo largo de 2020 y 2021. Actualmente, (al 14 de diciembre de 2021) se cotiza a $36 dólares y tiene un dividendo alto del 8.2%.
Mirando sus fundamentos, vemos que BTI tiene más de 55,300 empleados, lo que la convierte en una empresa grande y estable. Su crecimiento de ingresos es de alrededor del 5%. El precio actual (P/E) a las ganancias es de 10.27, lo que la convierte en una inversión deseable y, hasta cierto punto, sub-valorada (mÃralo como un descuento).
Tienen deudas pero nada fuera de los procedimientos operativos estándar. Suficiente efectivo para cubrir los gastos, aunque preferirÃa ver un coeficiente rápido (0.40) y un coeficiente actual (0.80) más altos. Tienen un uso excelente del precio (P/FCF) para el flujo de caja libre a 19.62. ConfÃa en mÃ. He visto cosas mucho peores.
¡Los márgenes son sólidos! Margen bruto 83.40%, margen operativo 38.10% y margen de ganancias 24.10%. Y la tasa de pago es un 59% redondeado. Lo que significa que pueden seguir aumentando el dividendo. Lento pero seguro.
Espero que la relación Deuda Neta / EBITDA vuelva a su rango objetivo, lo que generará más ganancias de capital en 2022. Esto incluye recompras de acciones, y la administración apoya esta opinión.
Desde la comodidad de su hogar, invierta en cualquier lugar de los Estados Unidos con Fundrise.
Ahora bien, ¿cómo nos pagan?
Antes de comenzar, responda esta pregunta: ¿Ha masticado o fumado dos paquetes a la semana durante 12 años o más?
Si es asÃ, sepa que les ha dado a estas empresas tabacaleras la cantidad que necesitaban para que esta inversión funcionara, y no tiene nada que mostrar, excepto un par de pulmones moribundos o encÃas gastadas. No te juzgo; haces lo que quieras con tu cuerpo. SolÃa ​​mascar tabaco y mi abuela todavÃa fuma. ¿DesearÃa que no lo hiciera para mantenerla en la tierra un poco más, posiblemente? SÃ. Sin embargo, ella es una adulta y respeto sus decisiones.
Nota 1: Si fuma más de 2 paquetes por semana, usted alcanzó este número en menos de 12 años.
Obtenga dividendos en efectivo de empresas reconocidas y establecidas.
¡Aquà vamos!
Usando números de Texas, un paquete de cigarrillos cuesta $6.69 y agrega impuestos, y usted paga $8.10. Entonces, fumando 2 paquetes por semana, gastas alrededor de $16.20 por semana. Redondeemos eso a un mes y obtenemos $64.80. Eso es lo que gasta mensualmente en Texas cuando fuma 2 paquetes por semana.
BTI paga un dividendo trimestral, por lo que multiplicaremos tus gastos de $64.80 * 3 y llegaremos a calcular que estás gastando $194.40 en productos de tabaco cada tres meses.
Al precio actual de $36 y un pago de dividendos de $0.745 por acción, necesitará 261 acciones; o una inversión de $9,396.
¡Recuerda! Probablemente ya le diste esta cantidad de dinero a las empresas tabacaleras y ni siquiera te diste cuenta. Sin embargo, haremos algo mejor. Comenzaremos a invertir en estas empresas y comenzaremos a cobrar dividendos.
¡NO! No necesita esta cantidad total para comenzar. Hay muchas formas de hacerlo.
Cubramos algunas ideas:
1. Cada vez que compra un paquete, debe depositar la cantidad exacta que gastó en su cuenta de inversión. Si no tiene suficiente dinero para hacer ambas cosas, no debe gastar su dinero en algo que no lo beneficiará a usted ni a su salud.
2. Establezca depósitos automáticos, ya sean semanales, quincenales o mensuales, iguales o superiores a la cantidad que gasta en este producto.
No pierda el tiempo recibiendo el dividendo en efectivo y comprando acciones manualmente. En su lugar, verifique cómo configurar un plan de reinversión de dividendos (DRIP) con su corredor. El sistema invertirá automáticamente su dividendo en sus acciones que pagan dividendos, y no tiene que mover un dedo.
Bono 2:
Una vez que alcance las 100 acciones de la misma acción, aprenda a vender ‘covered calls’. Es una gran estrategia de ingresos y lo ayudará a alcanzar sus metas más rápido.
Sea un propietario en cualquier lugar de los Estados Unidos, sin complicaciones.
Resumen:
Puede investigar una acción que pague dividendos de su agrado y seguir los pasos anteriores. Luego, cuando alcance su meta, apague el DRIP y comience a recolectar los dividendos en efectivo para hacer lo que quiera con su dinero. Por ejemplo, puede hacer que la empresa pague sus gastos de tabaco o para los no-fumadores; Puedes usar este dinero para hacer lo que quieras.
Disclaimer: Lea nuestra polÃtica de divulgación aquÃ. Esta publicación contiene enlaces de afiliados y yo gano con las compras que califican sin costo alguno para usted. Existe un alto grado de riesgo involucrado en la bolsa de valores. Los resultados pasados no son indicativos de rendimientos futuros. Road-to-wealth.com y todas las personas afiliadas a este sitio no asumen ninguna responsabilidad por sus resultados comerciales e inversiones. Los indicadores, estrategias, columnas, artÃculos y otras caracterÃsticas son solo para fines educativos y no deben interpretarse como consejos de inversión. La información para cualquier observación comercial se obtiene de fuentes que se consideran confiables. Aún asÃ, no garantizamos su integridad o precisión ni garantizamos ningún resultado del uso de la información. El uso que usted haga de las observaciones comerciales es bajo su propio riesgo y es su exclusiva responsabilidad evaluar la precisión, integridad y utilidad de la información. Debe evaluar el riesgo de cualquier operación independientes con respecto a los valores mencionados en este documento. No somos asesores financieros y esta publicación es solo para fines educativos. Invertir conlleva riesgos. Asegúrese de visitar a un profesional que pueda diseñar una mejor estrategia para cumplir con sus objetivos personales y circunstancias actuales.
“The biggest risk is not taking any risks” Mark Zuckerberg
DISCLAIMER: Please read our disclosure policy here. Links in this post may contain affiliate links and as an Amazon Associate, I earn from qualifying purchases.
We all want to live before we die, right? That means that at
some point, we have to stop trading away our time for dollars. Money is important
but we need to stop working for a salary or a wage and figure out how to make
money work for us!
First thing is, you need to be honest with yourself. Answer
the following questions with all honesty and see where you are. Just a simple
Yes or No.
1. Do you operate your household with a budget?
2. Do you know how much debt do you currently have? (Total
debt)
3. Do you routinely pay your bills on time?
4. Do you have savings for an emergency? (At least $1,000)
5. Do you have a plan for tackling your debt?
6. Do you regularly charge your credit cards because you
spend more than your paycheck?
7. Do you hide bills from your family?
8. Have you been turned down for credit/loans?
9. Do you prefer to buy fun things today than buying assets
for the future?
10. Do you think the government and social security should
provide enough to cover your expenses in retirement?
See how you did…
If you answered ‘Yes’ to questions 1-5, that’s great! You
are already taking control of your cash flow…
If you answered ‘No’ to questions 6-10, that’s also great!
… You have the right mindset and probably just need a little push…
If your answers are mixed, you have some work to do…
If your answers are completely inverted, You are headed
toward financial disaster. You need to re-evaluate your life big time.
At first, it is difficult to change your bad habits. You bet
it is. But your life can dramatically change for the better and it all depends
on you. See how you spend your time and that will give you an idea where your
life is headed.
I come to figure out in my 30’s, that I do like to read. As a young person, I thought I didn’t like to read. Actually, I figured out that when it comes to making my money grow faster and faster, I can’t stop reading once I start.
Everyone is money-oriented. Some to spend, some to
accumulate. The difference is financial knowledge and literacy. The ones that
read about money and apply it in real life, get ahead of the game. The ones
that not, live through struggle their whole life.
I will make several recommendations of books that I have
read and have been illuminated by new knowledge that when I started putting it
all together, my life started to change for good. There is no stopping now.
Note: Although it was not the first book I read, it is highly recommended you start with Twelve Pillars for a solid foundation…. but getting back to the article…
The first book I read
was:
#1. How to make money in stocks by William J O’Neil – in short, he follows and shows how to use the CAN SLIM formula (yes, it’s an acronym), uses both a few fundamentals and a little bit of technical analysis. He doesn’t use a get rich quick scheme. Slow and steady wins the race.
#3. The intelligent investor by Benjamin Graham – he teaches you to keep emotions under control and invest like an intelligent individual. No high IQ needed, or inside information or luck. You can’t ignore that some of his disciples have shown the possibilities when you put it all together. Like who you said? Nothing more than Warren Buffett who says this is the best book in investing ever written by far. Mr. Buffett is currently the 3rd richest person in the world with over $80 billion dollars.
#4. The millionaire next door – opened my eyes to the possibility that anyone with any type of income sources can get to where they want if they so desire. No high income is needed because everything comes down to your spending and savings habits. It shows you a simple formula to measure your wealth! Now, you will instantly know if you are ahead of the game or not. Are you a PAW, AAW or UAW?
#5. Rich Dad Poor Dad by Robert Kiyosaki – has expanded my knowledge to immense proportions. In summary, Robert’s real dad (poor dad) and his best friend’s dad (rich dad), shaped his life with the way they see money and investing. You don’t need big degrees or high incomes to be rich. You just need financial literacy about money and how the rich make money work for them and not the other way around.
I’m telling you, if you start with these 5 books, you will be way ahead of 80% of individuals I know because no one wants to read. If you feel like one of those too, let me show you a trick; read 10 pages every night before you jump into bed. For example, the millionaire next door is 270 pgs, at 10 pgs per night you will finish it in 27 days. Just under a month, you will have new knowledge that if applied, you can start your own road to wealth.
Knowledge is power, only if put into action. You can know it all, but if you don’t start, it just goes to waste. Don’t be one of those 10 years from now saying, only if it would have started earlier.
I’m glad I didn’t wait that long but still would have loved
to have all this knowledge when in college. My life would have been even better
than what it is right now, which is not bad at all. I mean, I just doubled my
wealth in 2 years and 8 months.
Don’t be left behind. Jump on the bandwagon and give me
company on this journey in the road to wealth.
Remember, it’s all about the road to wealth. If you liked
it, pay it forward. Don’t forget to share it on social media and help others
become successful as well. There is plenty of room for all of us. In the end,
your success will only depend on you and not what others do.
DISCLAIMER: Links in this post may contain affiliate links. Please read our disclosure policy here.
Yesterday I attended a Woman’s Equality Luncheon (Equal
Opportunity Program for the Army). The guest speaker spoke eloquently about
women rights and how long it took to get where it is today.
There were lots of failures and sacrifices but if there was
one thing they all had, was the courage to fight for what they wanted.
I ask you today, what is it that you want?
If it is financial freedom, I encourage you to find within
yourself the courage to make the necessary changes in your life, as all these
courageous women did for years.
It won’t be easy, and it will take time, but in the end, you
will look back and see how far have you gone and how much have grown since you
made your choice.
Let’s start by making this point very clear: If you are going to get out of the rat race (a term used from Rich Dad Poor Dad), your cash flow has to exceed your expenses. But…
Do you know what your monthly cash flow is today?
What is your monthly cash flow goal to get out of the rat race?
The answers to the previous questions are important.
But first, you need to build a solid foundation for success; pillars. Twelve pillars to be exact.
The book “Twelve Pillars” by Jim Rohn and Chris Widener explains it in detail.
The pillars are based on the following:
#1 – Work harder on yourself than you do on your job
#2 – Total Well-being
#3 – The gift of relationships
#4 – Achieve your goals
#5 – Proper use of time
#6 – Surround yourself with the best people
#7 – Be a lifelong learner
#8 – Life = sales
#9 – Income seldom exceeds personal development
#10 – Communication is key
#11 – Be a leader
#12 – Leave a legacy
CONCLUSION
You got a head start, but you need to dig in and get the details of this great book. You have to show how bad you really want it. Success is not easy, and there are no short cuts.
To our wealth! Leave your comment below.
Remember, it’s all about the road to wealth. If you liked
it, pay it forward. Don’t forget to share it on social media and help others
become successful as well. There is plenty of room for all of us. In the end,
your success will only depend on you and not what others do.
“If you can’t explain it simply, you don’t understand it well enough” Albert Einstein.
DISCLAIMER: Please read our disclosure policy here. Links in this post may contain affiliate links and as an Amazon Associate, I earn from qualifying purchases.
Hello friends, we haven’t talked
for more than a month. And I already missed you all. I can tell you quickly
that I live in a new state due to work. The months of June and July have been
crazy. On top of that, I signed up for real estate classes and other types of
investments.
Obviously, as long as my
knowledge expands, I will be sharing with you so that we can all progress.
Among many other things that are new to me, I learned that there are two types
of debts. All my life I thought all debt was bad.
Before getting into debt, I have
to say that managing your money is just the beginning. Then comes the
interesting thing, learn about money and how to make it work for you while you
are not present.
We have to recover our cash flow
and use it to obtain assets that give us money back, that work hard to generate
more money for us. Not objects that take money out of our pockets. That is the
magnificent secret of security and financial freedom.
What nobody tells you…
Debts are divided into two
types, good and bad. Most people learn to have bad debts.
Debts are like everything in
life. Depending on how you use it, it can be good or bad.
A gun can be good or bad
depending on the person who uses it.
Drugs can be good or bad
depending on how the person uses them.
If you do your part and learn how to use debt, it can be your slavery for life or your independence for life. You choose.
What are bad debts?
Bad debts are personal loans,
car or home loans, student loans, and credit cards.
Why are they considered bad
debts?
Because they only take money out
of your pocket and in the end, they don’t have the same value as when you
bought them.
The plan is to get out of all
your bad debts, and when you get out of all your bad debts, then you will get
more debts. Whaaaatttttt?!?!
It is true, but this time you
will get good debt.
What are good debts?
Good debt comes in many forms.
Good debts are those that can give you financial freedom in the future. For
example, you buy an apartment to rent it. Yes, it is a debt, but it has several
points in its favor.
#1. The payment of your loan
does not come out of your pocket. You have a lease that pays your debt. In the
end, when the loan is repaid, you are the owner of an apartment and it can
produce passive income for the rest of your life and perhaps your children
after your die if you have not sold it. Best part is, nothing came out of your
pocket. That is how wealth can be passed down from generation to generation.
#2. You get equity or value in
the apartment over the years. So, if you decide to sell, you can earn capital
gains.
#3. You have government tax breaks because you are providing a service/lodging.
#4. You can repeat this cycle as
many times as you want, until you receive enough in passive income to the point
where you do not depend on a job and can retire early and enjoy life.
Now that is real security and financial
freedom.
As you can see, this type of debt is what the rich use to get richer.
If you focus on blaming the
government, you think that social security should maintain you in your
retirement years, you dedicate yourself to studying and continue to accumulate
student debt; I am sorry to tell you that you will never rise from being poor
or middle class.
To enter the group of those who
have wealth, you have to learn about money and how it works. Do not be left
behind.
For today, we have learned that
not all debts are bad. I will return soon with more so we can all progress.
Until next time.
To our wealth! Leave your
comment below.
Remember, it’s all about the
road to wealth. If you liked it, pay it forward. Don’t forget to share it in
social media and help others become successful as well. There is plenty of room
for all of us. In the end, your success will only depend on you and not what
others do.
ROAD TO WEALTH! 