One of Those Weeks that Really Test Investors

Written by The Dividend Guy on January 6, 2007

After coming through a pretty strong end of the year in 2006 in the markets, it can be real jarring for investors when we have had a week like we just did, especially in Canada.

The S&P/TSX Composite in Canada had an especially brutal week where the index dropped 3.3% - and that was on a short week. The Dow was a little better with a drop of 0.5% and the S&P 500 dropped 0.6%. The hardest thing to look at is in Microsoft Money when the Total Change column is showing ALL red numbers.

But alas, we need to look back at our strategies of long term performance and dividend growth. One week does not a market make. To me, this is the problem with those of us who like to watch the market. You get so entrenched in the day-to-day gyrations that it can be easy to forget the big picture. I am proud to say I did not sell anything. I actually bought some more of my company stock (through our stock purchase plan) during a week when all energy stocks were, what is the phrase I am looking for, blowing their faces off. Dollar cost average baby - works nicely in a down market.


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2 Comments so far

  1. Canadian Money Blogs Reviwer January 7, 2007 9:49 am

    Talking about stocks that went down (somehow), what do you think about BCE for dividends? Do you see it as a good income generating investment despite the fact that they are not going to be an income trust?

  2. Young Wanderer January 7, 2007 9:17 pm

    It is weeks like last week in which having steady dividend stocks are such a good investment. I enjoy reading your blog, keep up the good work!

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