Wednesday, November 30, 2011

Watch list usage for your investing

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

Is it really critical to have a watch list and get the best price for your investments? Keep in mind that my time horizon is 15 years to retirement and that only places me in my early 50s I then have another 30 or more years to live after that. Every couple % extra discount in price you get means you will get more shares especially with Sharebuilder allowing for partial share purchases. Compound that over 45 years and yes it will add up just as much as those $0.005 drip raises. So being patient and waiting for a good price is important.

That is all fine and good but what about my purchase of WMT? I bought that in Oct at the end of a 10%-15% rise. Doesn't that conflict with what I just said? No because with WMT I got in based on its historic P/E levels whereas with WM there wasn't a discount of note.

WMT has a 10 year P/E average of 18.79.  Right now they are sitting at a 12.39, a 65% value of their historic norm. Now if they were overvalued in the past or undervalued now is a different topic of debate.
WM would need to be at $22.93 to match that same discount. If WM had that price right now then I would be a lot less choosy about my entry price.

Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others.
I am not a financial planner, financial adviser, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets

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