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Paying Dividends Since the 19th Century

Can you list at least five companies that have been paying dividends since the 1800s? How about 10 companies which have been paying dividends for more than 115 years? In this post I list a few American and Canadian companies that have been paying dividends for a very long time.

But first, what is a dividend? A dividend is a cash payment paid to shareholders monthly, quarterly, or annually. The company decides when and how much to pay shareholders. As a shareholder you are part owner of the comp…

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Top 5 Reasons Why Mutual Funds Fail

Fees

1. Mutual funds charge a fee, the Management Expense Ratio (MER), to cover their expenses. An MER virtually guarantees that mutual funds will lag the stock market performance. In a previous post I discussed the high cost of mutual fund fees.

Selling at the wrong time

2. A mutual fund will drop in price if a large number of mutual fund holders decide to sell their funds in a short amount of time. This is especially worse during a market downturn, at which time everyone runs to their mutua…

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Investment versus Speculation

Are you an investor or speculator? Or are you a speculator thinking that you are investing? Over the years I’ve heard people say things like, “I’m going to play the stock market. I’ll gamble a few hundred dollars on this stock. If I get lucky I can retire soon.” When talking about stocks, I never mention the words “play” “gamble” or “lucky”. Those words belong in a casino not when you are investing your hard-earned money.

There is a big difference in investing versus speculating, Benjamin Graha…

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Most People Will Never Be Rich

Most people will never be rich. Why? Because most people (the middle class) are investing the same way as everyone else, and everyone else is not rich. The middle class are not wealthy, and if you are going to invest like the middle class then statistically speaking you will never be wealthy. You have to change the way you think and act about investing in order to achieve financial success.

You were probably told by your parents/friends/peers to go to school, get a good education, get a good jo…

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Imagine Never Having to Pay Federal Income or Payroll Taxes!

It’s that time of year again. Tax time! Everybody’s doing their taxes or thinking about taxes ….so, this reminded me of something I read in Berkshire Hathaway’s 2006 annual report where Warren Buffett talked about zero taxes for all.

On page 19 of Berkshire Hathaway’s 2006 annual report Warren Buffett wrote:

“Berkshire will pay about $4.4 billion in federal income tax on its 2006 earnings. In its last fiscal year the U.S. Government spent $2.6 trillion, or about $7 billion per day. Thus, for m…

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Cisco Announces First Dividend Ever, But I’m Not Buying Any Shares

Cisco recently announced its first ever cash dividend. But I won’t be rushing to buy Cisco shares, here’s why:

  1. I look at a company’s history of paying dividends, at least 10 years or more of uninterrupted dividends.
  2. I look for a long history of increasing dividends at least 5-10 years, the more the better.
  3. I generally don’t invest in technology companies.

Let’s take a look at all 3 reasons….

Company’s history of paying dividends

Whenever I consider shares for investment, one of the thi…

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Canada Gets an F in Mutual Fund Fees

Canadian Capitalist recently posted a great article about a recent Morningstar report that shows how bad mutual fund fees in Canada are when compared to other nations.

“The report found the median asset-weighted expense ratio to be 1.31% for fixed-income funds, 2.31% for equity funds and 0.80% for money market funds. These fees were the highest among the 22 countries in the survey for equity funds, third highest for fixed-income funds and tied for highest for money market funds. Morningstar fou…

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My Best Investment Yet

275.97% return since I first purchased shares in TransCanada Corporation (TRP) in 2000. The return includes dividends, which I discussed in an earlier post. 275.97% return sounds like a really big number, but aside from the dividends I have not received a penny of profits yet. Why? Because I haven’t sold my shares in TRP yet, perhaps I never will. Why? Because my dividend yield based on the original purchase price is now 11.94% which is better than what I can earn in a savings account, term depo…

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Proof of Profitability

The following four paragraphs come from Kelly Wright and I could not have said it better myself:

"From our perspective and experience, the cash dividend is the more attractive profit path when investing in the stock market. In the first instance the cash dividend is just that, cash in hand; a tangible return on investment. Unless a company is committing outright fraud, a practice that will typically be short-lived, the cash dividend is evidence that the company is indeed generating profits; a c…

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Understand this important factor and become a successful investor!

Actually there are a number of important factors, 12 to be exact. I call them the 12 Rules of Simply Investing and I cover them in great detail in my online Simply Investing course. Today I am going to describe one of the 12 important factors the P/E Ratio. Understand this ratio, and you will save yourself from making poor investment decisions and save thousands of dollars in the process.

Before I knew what the P/E Ratio was all about, I did indeed waste thousands of dollars on lousy investment…

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