ltecato (< 20)

What do I know? Nothing, really

February 01, 2012 – Comments (2) | RELATED TICKERS: DUK , WMT , TWC

I've been unemployed since October 2008, except for occasional freelance work as an editor or proofreader. Not long before I lost my job, I opened a ShareBuilder account to play around with.

I tried swing trading but kept losing money. Finally I decided I'd buy some "boring" blue chip type stocks that I could hold for a long time. Pfizer, Traveler's Insurance and Colgate were part of  that new strategy.

Then I noticed that these companies were paying dividends much higher than anything available in a money market or CD. So I shifted my focus to megacap, "household name" companies that paid at least 3% dividends.

I don't keep records carefully enough to declare for certain that my approach has paid off, but I think it has, based on account statement provided by ShareBuilder. Dividend income has certainly helped.

This week I sold off three stocks to raise cash. Duke has lost value recently and I think I can do as well or better in the dividend department if I replace it with another utility stock. I sold Time Warner Cable and WalMart because they had run up in value about 20% since I bought them, and again, the dividends were not spectacular. 

Now I have to decide what to do with the cash I've raised. Two sectors I've been itching to try are banks and homebuilders. Obviously both have been murdered in this recession, but it seems to me that at some point the values are going to return to pre-recession levels. I'll be keeping an eye out for bargains to scoop up in the next few weeks.