I'm Back...Right Where I Left Off

It has been a year since my last post. I just couldn't stay away any longer given the amount of variables that keep popping up helping to hinder economic and financial growth. My last post was about how Europe fears will linger in the market for a while to come. Amazing how that is still the case given how Greece is still on the brink of default with a few other countries also having financial troubles. We are seeing the same problems over and over. They take a few weeks or months off and then reappear. Investors, with our short term memory problems, tend to forget about these problems when they temporarily disappear from the markets.

Yesterday was the largest of a long strings of losses for the markets. I, along with all other investors, have felt the discomfort of losing money day after day with no end in sight over the past week and a half. I have made the same mistakes that I have sworn to never make again. I revamped my portfolio a few weeks ago when things seemed to be looking up; however, I didn't include a couple of key things. I kept almost no available cash for any drops in the market. I also did not set any limits. Had I set limits, most of my holding would have sold off allowing me to then have available cash to buy back at a lower price. I would have been a lot better off with either of those things. I didn't necessarily have to have both to be fully covered.

The only reason I am not as worried as I used to be is because of a longer term view I have taken on. I have seen a lot of companies I have sold, after either making or losing money, go on to rise a lot further. Some have fallen a lot further making my selling ideas seem genius. The question is what has continued to go up and go down? Larger, value companies keep going up. It may not be quick or continuous. It is, however, filled with dividends that make up for a month of no return. The ones that tend to go down and keep going down are smaller, growth based companies that are mainly technology based who keep missing earnings forecasts. I am not worried because I have filled my portfolio with mostly large cap companies with great dividends. Even though they might be falling now, I see dividends popping up in my account making me remember why I bought these companies. Even midcap companies that I have invested in have a small dividend package. Although I may not have kept my two key ideas of keeping cash and setting limits, I have invested in dividend based companies giving me a reason to not feel as worried as I would have been.