When The Market Crashes
Now that the market dropped like a sack of potatoes, Cramer has some good advice. (Of course hindsight is 20-20, but still its good advice!)
You only have a couple of protections from the whims of a broken system:1. A company that pays you a dividend that is equal to or better than Treasuries after taxes is a good defense.
2. Or you want a stock that has a valuation so low that you know it’s a bargain — and its management knows it’s a bargain (read: it’s buying back stock right here).
3. Last chance: a company that is so defensive in nature that even if there’s a worldwide slowdown, it will meet expectations regardless: Coke (KO), Pepsi (PEP), Altria (MO), Kellogg (K), General Mills (GIS), Clorox (CLX) and Colgate (CL).If you don’t anything that fits one of those three criteria (I’d rather have two or three per company) you will not be OK for now. That’s because we are now going to have people who just say, “Wow this is too crazy, let me out of here!”
But nobody ever made a dime panicking. This time will be no different, but only if you are shrewd about what won’t hurt you and what can work in a volatile and down environment.
In India, stocks like Colgate, Johnson & Johnson, Proctor & Gamble and Unilever are called blue-chip stocks that never go out of business because they make stuff everyone needs and uses. Maybe I should stop looking at their prices everyday and finally buy some!
If you found this post helpful, consider donating to my coffee fund!![[del.icio.us]](http://images.del.icio.us/static/img/delicious.small.gif){kind=small}
- Why I'm Buying Boring Stocks I remember the good ol' days of the Internet Bubble in late 1999, early 2000. I bought Qualcomm (QCOM) at around $300 a share and watched it skyrocket to $800 a share in less than a year. Valuations didn't matter, only the stories behind the stocks. I had lofty ambitions......
- PetroChina Is World's Second Largest Company PetroChina (PTR) has become the world's 2nd largest company behind only Exxon-Mobile (XOM) in terms of market capitalization. Since its IPO in 2000, the stock has soared. Its been up 100% nearly every single year! According to Bloomberg, this is a reflection of its key role in supplying oil to......
- Common Sense Advice For Investing In The Stock Market Given the poor performance of the stock market in 2008, its time to go back to the investment basics and make sure you don't forget the important stuff. 1. Only invest in companies that pay a decent dividend (at least 3%) and that have a long history of increasing their......
Related Websites
- Memorial Tournament Recap This week in golf featured the Memorial Tournament, presented by Morgan Stanley and hosted by Jack Nicklaus. The memorial tournament brings in plenty of big names as the golf world looks back at some of the greatest golfers and individuals who contributed to the growth of the game. Prior honorees......
- The Ultimate Contrarian Portfolio, Part 1 True contrarian investors are made of sterner stuff than you and I are. If you're like most people, you may find it tough to buck market consensus -- to go against what you hear and see in the media everyday. On one level, contrarianism is just about going against......
- Easy May Not Be As Easy As It Sounds... Your heart is racing you just realized there is a goldmine online for you to tap so you eagerly dig in and start researching. Why network marketing as opposed to other online business models ? I looked at all types of different models to make money on the internet. CPA......
[All content is copyright of Living Off Dividends & Passive Income]
Leave a Reply