How to Invest in Best Dividend Stocks and Pick Penny Stocks For Maximizing Returns
And the best dividend stocks belong to those companies that has regularly paid dividend to all its shareholders for many years at a stretch without break.
Such forms of stock are the safest for long term investments.
These are known to appreciate steadily in value over the years.
Historically such dividend paying stocks offer better return and carries minimum risk, than the so called growth funds.
No wonder stocks that offer regular dividends consistently are by and large stable and mature than those that don't and whose price patterns fluctuate too frequently.
Such volatile shares, however potential, are difficult to read because of their erratic behaviour and is beyond the comprehension of novice who enter the stock market.
In such situations one has to depend upon so called "expert" brokers and fund managers for advice provided they are reputed with a long standing.
Shares that offer dividends consistently are less prone to be volatile even when the markets are turbulent.
These are the ones which are most lucrative amongst conservative investors who has very little appetite to stake their hard earned money.
Although the value of such shares do not rise and fall heavily like most growth funds, their value continues to rise surely and steadily even when the markets are sluggish or choppy.
In the long run, after several years such dividend paying shares outclass all other forms of investment in the share market sowed in the initial stage at the same time.
If the investor had wisely reinvested the dividends too on a regular basis, then at the end of say ten or twenty years, the amount earned after selling those shares at current market rates would fetch a considerable sum.
No wonder such dividend paying stocks have remained the safest and best bet amongst investors with long term objectives.
However such stocks especially of Blue chip companies come at a price, unless you had wisely brought them when the markets were down such as during recession.
Also you must have enough funds at the time of initial investment to be able to spread your investment in thick over a large diversified dividend paying stocks of reputed companies from various potential sectors, be it energy,infrastructure,finance, defense, food, security, FMCG (short for fast moving commercial goods) etc.
Moreover you must be ready to forget about the fund once you invested them, as it continues to lay golden eggs consistently and at no point of time you intend to withdraw the principle amount during the lock in period along with the dividends earned and reinvested.
So for every dollar invested for shares nearly forty years ago it would fetch you $400 at current market rates.
That means to earn million dollars for the same lot of shares one today had to invest $2500 in the best of diversified dividend stocks available way back in the early 1970's.
That's quite a considerable sum to retire with.
Penny Stocks for Investment: There are however people who have very little funds to invest and yet wants to dip their toes in the stock market.
For them what could be a better option than to invest in penny stocks to begin with.
If you are young and able, perhaps in your early twenties or thirties, with a steady source of income, and willing to invest $500 or even less in diversified portfolio of penny stocks, then perhaps you may take a calculated risk to earn more from penny stock investments.
If you are willing to learn the ropes and follow the trend with the help of specially programmed stock analysis software you too can end up earning $20000 within a year.
I must warn you that investing in penny stocks although tempting is highly risky and cannot be compared with reputed dividend stocks.
Although highly risky the penny stocks can actually offer very high returns in a very short duration say in a day or two but one has to remain alert to make the most of it and by minimizing loss that's most likely.
Its easy to learn but by having control over ones greed factor, lest you overestimate and stall.
Penny stocks trade at less than $5 a share over the counter (OTC) and because of their low price are not controlled and examined as the other stocks of listed companies in NASDAQ or NYSE.
These are listed on the OTCBB and you need the service of specialists for reliable information and guidance on companies offering penny stocks for trading.
However for the common man its sometimes a difficult proposition because of several constraints that at times prove to be challenging and frustrating too.
Stock Analysis Software developed by an MIT mastermind dropout that fetched him millions from penny stock: But with the help of special software its actually possible in the comfort of ones home or office to identify which amongst the stocks are performing well and those that have great potential using the stock market technical analysis.
Quite recently a young mathematics genius who dropped out from MIT has developed such a software.
He has come up with an algorithm to build a unique stock analysis software that fetched him one million dollars in a single year by investing only $1000 in penny stocks in just 38 trades,that too without leveraging.
The same application helps to pick the best dividend stocks too.
The application takes into several factors for statistical and mathematical computation including human psychology for stock analysis and research to tell which amongst the stocks have great demand and potential.
He has since been offering personal help and advice regarding investment in all sorts of best dividend stocks and pick penny stocks to thousands through his highly informative newsletters for free as well as to paid members.
Learn more on hot penny stock trading.