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How To Use Margin Safely And Profitably

How To Use Margin Safely And Profitably

Posted On February 19, 2019 12:05 pm
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Like any financial tool, margin isn’t bad, just needs to be used responsibly. Here are three simple rules for how to make sure that leverage doesn’t lead you to the poor house.

Summary

  • To make my weekly “best dividend stocks to buy this week” series more useful, I’m breaking that into three parts.
  • A reference article about the right and wrong way to use margin, the watchlists themselves, and a weekly update on the Deep Value Dividend Growth Portfolio.
  • Margin is a powerful tool, which like fire, can be used wisely to elevate your wealth to new heights or burn your portfolio to the ground if used incorrectly.
  • There are three critical rules to using margin safely and profitably, which many investors have managed to achieve.
  • I’ve accelerated my personal deleveraging plan via the sale of three of my high-risk stocks and will be margin free by the end of the year (and personally don’t plan to use it in the future).

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Photo: “Wall Street 1” by Mike Czumak is licensed under CC BY-SA

About author

Dividend Sensei
Dividend Sensei

I'm an Army veteran and former energy dividend writer for The Motley Fool. I currently write for both Seeking Alpha, Simply Safe Dividends, and DividendSensei.com My goal is to help all people learn how to harness the awesome power of dividend growth investing to achieve their financial dreams, and enrich their lives. With 22 years of investing experience, I've learned what works and more importantly, what doesn't, when it comes to building long-term wealth and income streams. I'm currently on an epic quest to build a broadly diversified, high-quality, high-yield dividend growth portfolio that: 1. Pays a 5% yield 2. Offers 7% annual dividend growth 3. Pays dividends AT LEAST on a weekly, but preferably, daily basis

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