Mortgage Blog

I know WFC was a bad investment. The stock price was back to the same level as 12 months ago. But I still picked some yesterday.

I purchased at $48.12. Then if the dividend stay the same, I can get around 4.25%. For the next 12 months, if the price goes back to $50.12, then I will make 2/48.12=4.15%, another 4.15%, then my total return would be 8.4%, not bad for a stock. And if 5 years later, as long as the dividend is ok, and the stock is $58.12, I can have 8% for the next 5 years.

I know it could be worse, what if the stock goes down. Yes, if the stock is lower, then my dividend income would be higher. Last year , I picked up some AT&T dividend at 8%. And the stock went up 37%, so my total return around 45%. Do I worry about this one? Not at this level. Same as WFC. And still I am very conservative. 6-8% annual return would be good enough. I have quite good income on dividends. I know I am different, very conservative. But do not assume my return was always low. I got 45% last year, still no tech stocks.