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Hello, Subscriber!
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One of the key concepts in investing is to know the value of your holdings in comparison to the market; called your "position". As an example in simple terms, if you buy 1 share at $2 then add to your position when the share price drops to $1, you acquired a total of 2 shares at a cost of $3. Your position then is $1.50 per share. ($3/2=1.5 each)
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So in very simple terms you can say it's your average cost per share, but other factors like fees, commissions, capital gains, and dividends also come into play. If well played, you can add capital gains when the market is up, add shares to your position when the stock is "on sale", and net dividends for as long as you own stock that pays a dividend. It's a magnificent feat indeed if you can get your position to zero! Holding stock that continues to pay a dividend having recovered 100% of your capital is golden!
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At that point, it matters little what the market does. A good company making enough profits to pay a dividend over long periods usually attracts and keeps good management and is likely to ride out economic storms. Buying more of a good company on sale can be a long-term boon if you can be the one sitting on cash when the market is down!
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If you're prepared for inflation and the shaking of the financial system with Au and Ag, what's your "position" with gold (Au) per ounce? ... silver (Ag) per ounce?
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A slight challenge: If $100 dividend is paid quarterly on your 1000 shares of stock, how much does it reduce your position for each share over the year?
[see end of email for the answer]
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If you find this interesting or helpful, please share it.
Here's some more noteworthy information:
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Gerald Celente: Founder & Director of the Trends Research Institute – Gerald has had a long track record of making some of the most controversial, yet correct calls in terms of global trends and events. In fact, many consider Mr. Celente to be the top trends forecaster in the world. [LINK]
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Tying the geo-political and economic stories together and reinforcing my recent predictions: Kiev will fall, Russia, China, and India are likely to further distance themselves from Western banking, 1970's style inflation with every sector in catastrophic levels of debt, and the dollar weaker than ever. [LINK]
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Some simple math: If you acquire 10 ounces of silver at $30/oz, and another 10 ounces at $40/oz; what is your resulting position for ounces of silver?
[see end of email for the answer]
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The U.S. Dollar
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"Something wicked this way comes." The financial circumstances in several sectors are unlike anything we've ever seen; and they're all poised for catastrophe at the same time.
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Net gains in savings and investments:
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xls: MS Ch12 Invest Position Workbook
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This Investment Position workbook (.xls file) is a spreadsheet that allows you to input the factors of an investment, automatically calculate totals, and see where your value lays in reference to current market price; your "position".
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$50.00
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xls: MS Ch2: Monthly Budget Expanded Tour Special
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Make your monthly budget and financial planning easier with a spreadsheet. 500 line capacity for records, 25 user-defined categories, sort by source, date, or category with one-touch buttons, and plan for long-term expenses with two figures: the total amount, and how many months until it’s due! Simple! Discounted for Ch2 Tour Enrollees.
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$35.00 $14.00
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MoneySmart Chapter Tours
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Having more money to manage is matter of the habits you use to manage the money you have! Check out the MoneySmart online chapter tours here:
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I've moved my financial services business from public to private. Learn how government policy like regulations and taxes can be kicked to the curb!
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