I was just reading a review about buying Air Canada (TSX-AC.B). Personally, I would never buy any air plane stock. I just do not see that you can make any money on this. These are never stocks that you can put away and forget about. Has any air plane stock lasted more than 10 years before it had to restructure the company because of lack of profits?
For Air Canada, I just looked at its chart on G&M. The 10 year chart goes back to only November 2007. The price was $19.32. The price now is $2.42. Need I say more?
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Susan, your blog is fantastic. I am retired and managing my own portfolio for the last 3 years. I am going follow your idea of having 5 years of dividend income and cash reserves. Right now I have about $13,000 a year in dividends (no idea on the growth rate though I do try to buy dividend growers) plus enough cash to last 5 years. But I have rented my house out for 3 years in order to build up my portfolio. Once I move back to the house, I won't have enough, so now I am torn -- focus on growth stocks to get back in the house, and then focus on dividend growth stocks to build up the 5 years income?
ReplyDeleteI agree with you on airlines - too risky. However, I did make a nice profit on WJA but I watched it every day, and then dumped it when it had a stumble.
My main challenge is getting my surplus cash invested. I wait til I find an opportunity - a stock with a lot of catalysts and a good price and good momentum. I watch BNN Market Call a lot.
Any advice for me?
I am new at commenting so don't know how to comment as, hence anonymous. Call me Carkey.
Dear Carkey:
DeleteI track my dividend growth and income growth using spreadsheets. However, I do use Quicken to keep track of my stocks.
The problem with growth stock is that we have been in a secular bear market since 2000 and this is expected to last at least another 5 to 10 year at minimum. In secular bear markets it is harder to earn capital gains on growth stocks, but of course, not impossible as there will be cyclical bull markets such as we seem to be in now. However, I think that this cyclical bull market is getting rather long in the tooth.
As you mentioned, it is possible to make money in airline stocks, I just think that they are not long term holds. I have generally made money on tech stocks. I understand them better and find them interesting. I have bought some resource stocks recently because they were cheap, but I expect them to be rather long term plays.
I do not watch BNN at all. However, I know people that do. They have complained to me that you have to be careful on stocks recommended on such shows as some stocks are just duds. However, they have also gotten good leads on other stocks.
Sorry, I cannot give out advice because I am not a financial advisor. I do track about 150 stocks that are almost all dividend paying stocks. See my website for stocks followed. I find dividend paying stocks less volatile, but you can make money in non-dividend paying growth stocks because of their volatility. You seem to know what to look for in buying growth stocks by your comments. You also realize that such stocks need to be watched.
I am not sure that any of this is of any help. I am not tracking currently the sort of stocks you seem to want to buy. You can also email me at brunnsu@rogers.com.
Susan