Buying Dividend Stocks At The Bottom

Everyone loves a deal and loves getting something at a rock bottom price. Dividend investors are no different. However, as long-term buy-and-hold investors, we aren't known for our ability (or desire) to time the market and call the bottom. That's not to say we can't enjoy the benefits of buying at the bottom. So, how does a long-term buy-and-hold investor accomplish this?

It is really quite simple if you employ a sound asset allocation model and systematically invest during the good times and the bad. Easy to say, and do, when things are going well, but many people have a hard time buying into a market that has been declining for an extended period of time. To the contrary, many investors sell their positions and move to cash when things look bad. Then move back into equities once they rise for a period of time. Sell at the bottom and buy at the top is not how to make money in the market. Many observers point to March 2009, when the S&P hit its low, as the bottom of the most recent market downturn. If you were following a disciplined approach and bought that month, you most likely are sitting on some incredible gains. Consider the stocks I purchased in March 2009:

Source: Dividends Value

(Photo: gerard79)


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