Hi all... I remember when I bought my first share 4 years ago. Yes, I was part of the "general" public that jumped on the stock trading band wagon. I lost my first portfolio in that fateful January after thinking I can predict the market and play warrants. I have changed my strategy just a little bit... My new trading strategy is ridiculously simple: (1) select arbitrary company that looks cool. (2) do homework on company, do I like their strategies, div yield, esp. forward predictions. (3) if company passes (2), buy, else go to (1). (end) So far, my portfolio is GREEN! (well, just a little bit...) The avid reader may notice no sell strategy. You're right, I don't sell. All the shares of really good companies seems to go up in the looo-og term, so much so that after a few years the dividends that they pay out exceeds the initial investment. I buy primarily for dividends, for a nice retirement in 30+ years. Now my question: In Simon's courses, back when the bull was at its peak, I remember him telling us about the bargains on the market with companies at 5%+ div. yield and no one buying... I don't want to sound funny... but isn't this EXACTLY what is happening right now? FSR for example... (nearly 6%), PPC (about 8%), SFN (about 9%)... the list goes on (forward PEs and DIV yields are even more). I don't know about what people are saying... but I really think it's time to buy for the long term. (sorry for the long post - no pun intended :-))
My (current) take: I think you have to combine a few ideas for future divs. For near-term, look at how the estimates have been dropping and extrapolate that 6 months at least. Sometimes it's frightening how wrong the "experts" got it - obviously they were working on immediate info, few assumptions of changes in the economy. For longer term, ignore what the short term will do - the short term is just there to scare others out. Look at as much of the div history as you can, and if it still makes sense on e.g. 2003 dividends, you should be safer. Note that some industries and companies are fundamentally changing so historical data isn't that useful.