Sunday, October 14, 2012

Accumulating Cash, Staying Patient

The lack of posting activity here has been mirroring my lack of investing activity over the last month or so.  I'm continuing to run screens and analyze new stocks however at this point in time attractive bargains are few and far between.  Aside from opening a small position in Caterpillar and taking some profits by selling a third of my Medtronic shares I have just been sitting on the sidelines and accumulating cash.

Right now that cash position sits at 11% of the portfolio.  Given that we are now in earnings season and that the market as a whole has been very choppy for the past few weeks the correct strategic move from my perspective is to lay low and wait for opportunities to develop.  That might well mean waiting until November to make significant purchasing moves.

That said, I remain committed to the dividend strategy (with a wary eye directed toward Congress) and continue to be a net buyer.  Despite the gloom and doom in the financial media keep in mind we are less than 5% off the S&P 500's high for the year.  Frankly I would welcome a 10% correction in the market right now as it would create beaucoup buying opportunities.  Such a correction would suck for older investors as well as day traders but hey, that's not my problem.

My inactivity aside, the dividends keep rolling in.  Coca-Cola, Kimberly Clark, Altria, Illinois Tool Works, and Phillip Morris have already delivered this quarter's dividend payments.

Looking for more financial advice but getting tired of me going on and on about dividend stocks all the time? Head on over to 6400personalfinance.com and follow me on Twitter @6400PF for a broader approach to building your net worth.

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