All of us are at different points in our lives. Why, you may be a college kid, dipping your little toe into the stock market waters for the first time with your whole life in front of you—no wife, no ex-wives, no alimony, no child support(s), no murder contemplations. Or you could be a middle-aged hardworking American with just a little way to go until you retire with all of your investments having to line up perfectly to make sure you have enough money to support your family and your constantly deteriorating health. Whoever you are, you have to plan for YOU.
In all honesty, I’ve been adding way too much to the Risk portion of my Cash Pie lately. While some of these dicey bets have paid off, many others have not. I figure that as a single man who’s already gotten rich once, I don’t have to play it as safe as I used to—in laments terms, I can “afford to be risky.”
As I said, these riskier investments (oil plays, start-ups, speculative) are hit or miss. By moving my portfolio around to add more risk like I have, I’ve missed out on a fantastic six month rally. I’ve run the numbers (oh boy, can I run some numbers), and if I had stuck to my original plans and my balanced Cash Pie, I might be bedding the likes of Jodie Foster instead of someone like Jodi Arias.
I look at my 2013 portfolios and I see a medley of things I’ve told you to buy and things I’ve bought: Sodastream $SODA, Advanced Micro Devices $AMD, Take Two Interactive $TTWO. As I look at my entry points and the green surrounding all these brilliant picks, I still see a higher percentage and payload by my Stalwart Beasts, most notably General Electric $GE and General Mills $GIS.
Those Stalwart Beasts…they’re not exciting. They just trudge along. There’s no big news, no sexy appeal, no glitter, no glisten, no gloss, floss. They’re just…there. But each quarter, unlike most Risk or Growth stocks, my main Stalwart Beasts, General Mills and General Electric, pay us a dividend.
General Mills $GIS, the makers of basically every single thing you’ve ever bought and eaten have paid uninterrupted dividends with NO reductions for 114 years—you could call them a “CEREAL dividend increaser!” ZING! The stock currently pays $.38/quarter for a total of 3.0%.
General Electric $GE, stutter-stepped during the recession and reduced their dividend but has made it a center of focus to restore it to its former glory. The stock is now paying $.19/share per quarter for a free payment of 3.2%.
Both of the Generals are basically like mutual funds, except you have more flexibility in your holdings. Each encompasses a giant division of our everyday lives.
In this ever changing world, it’s hard to find guarantees and promises that will hold true. Now, I can almost guarantee you crabs or the herp if you sleep with local hookers (even if they claim they are just visiting). I can almost promise you that you’ll come home from Vegas ($LVS, $MGM, $WYNN) with less than you started with. I can guarantee that if you don’t study the stock market, you can lose your shirt. So with all of those negatives, how nice and amazing is it that I can also guarantee you a GUARANTEED 3.2% or 3.0% profit each year… GUARANTEED. Those Generals go marching on!
I encourage risk in your portfolio. You’ll never be Cash Bauer or Mark Cuban rich if you don’t take some chances. But when those risky things don’t pay out, it’s always nice to be diversified enough to have the “Generals” marching along, being the lifeblood of your portfolio, and reinvesting their dividend (aka FREE money) each quarter.
I’m going to rearrange things in my portfolio back to the way they should be.
That’s the best thing about me, my faithful Cash-ists. I’m always ready to tell you when I fuck up. I don’t see a lot of my fellow pundits doing the same.