Thursday, January 19, 2012

The Downside of a Rally

Here we are.  The S&P is at 1,314 and the DOW 12,625.  Sounds great to most people because it means  investments have increased in value.  The problem for me as a dividend growth investor is that I have money to invest and good buys are harder to find.  I have yet to see any signs of a market downturn in January, which is a surprise with recent downgrades all across Europe. 

What to do?

I have cash piling up in my accounts that needs to be invested.  Should I wait to get maximum value on my hard earned money?  Will it be a long time before that happens?  What if it never goes back down?  I believe we will see more volatility this year and there will be some good buying opportunities, unfortunately that time is not now.  I plan to make one purchase this month to prevent too much accumulation of cash.  I think of it as treading water.  I'll still have a nice reserve for corrections and dips.

Currently K, KO, and SBSI appear to have some value left.  Before I wrote this post I put in a limit order for SBSI.  We'll see if it gets executed.


  1. I totally agree. Hard to find value out there. This may be the first month since I've started my journey that I won't make a monthly purchase of stocks...but mostly because of my recent vehicle purchase and to a lesser degree the market run-up and subsequent lack of value.

    PM, VOD and EMR are a few of my holdings that have been weak lately. May add to one of them soon.

    Best wishes!

  2. The order was not filled :( I missed the daily low by $.01, what a shame. I'm still watching K and SBSI. HNZ and EMR are also on the radar. There will be a lot of earnings coming out so maybe an opportunity will present itself. I'm planning on making a purchase next week.