$AT&T (T.US)$Hey Boys and Girls let me tell you the story ab...
$AT&T(T.US$Hey Boys and Girls let me tell you the story about Timmy and the Value Trap.
You see Timmy, read books about value investing, and he learned about Old Man Buffett, and how he needed to buy established companies selling at low multiples and this was great place to invest.
So he learned about Verizon and ATT, the value investors told him these are great stocks, established companies that sell services that millions of people use everyday, why they are so cheap its a great investment come place your money. Why look even Old Man Buffett owns Verizon.
Timmy did, he placed his hard earned dollars into the black holes of incompetence and mediocrity that is AT&T and Verizon. And after many years Timmy came back to find that his dollars instead of growing into a mighty oak of wealth had disappeared like magic.
And that is the lesson of value traps getting a good deal on a shitty business, doesn't change the fact that you still own a shitty business.
Since 2013 $Verizon(VZ.US$has returned annualized 2.6%, $AT&T(T.US$6%, while $SPDR S&P 500 ETF(SPY.US$ averaged 16%
Next time you think of trying to value invest, think of the children.
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mootastic : i can avoid value trap by doing covered calls, in fact AT&T is the best stock to do covered calls. you can basically earn every week from this stock since it doesn’t move much.
James Browny : What do you think about the Warner spin off? May be a good short term play for a decent gain.
hairless : Mr. Buffett also takes advantage of market dislocations.
"Since 2013 Verizon has returned annualized 2.6%, ATT 6%, while SP500 averaged 16%"
Comparing two points in time is what boiler-room brokers do to sell the elderly who answer the phone. Like Buffett, I do not personally invest in bonds. Instead, I invest in income stocks to complement my growth stocks in a diversified portfolio.
This little Timmy bought the bulk of his VZ shares in 2010 when they were trading at $26 yielding a tad over 7% at market. The current yield on the $26 invested in those shares is 9.7%, it was about 9.6% last year, and dividends collected to date have been about $24. So by letting the $26 ride for 10 years in VZ instead of a bond fund I have a 10 yr after tax return only a true Bond King could have achieved for me if he was very lucky and his commissions were low.
Johnny Thunders hairless: Yay Timmy!
Sacai Luis hairless: That's awesome. For next 10 years, just that yield on VZ will probably beat the SP500.
Sam White hairless: "Comparing two points in time is what boiler-room brokers do to sell the elderly who answer the phone."
Nonsense. I used this investing technique to sell all my T shares and invest the proceeds in Shiba Inu coins. I don't receive a dividend from those, but by extrapolating their recent capital gains (before I bought them, of course), I've concluded that I'll be able to buy T (the whole company) by Thanksgiving.
Indicator analyst : "Since 2013 Verizon has returned annualized 2.6%, ATT 6%, while SP500 averaged 16%"
Where did you get those stats from? T is down ~33% since 2013 and VZ is up ~15% since then.
Swing Trade Swag : depends on the valuation and what price is interpreted as "value"... maybe timmy just sucks at determining what a good value would be? had he decided to wait for $52 or lower to buy, maybe he would have a different outlook on investing and the stock market as a whole come 2-3 weeks from now when it's back up
timmy probably should of asked mr. buffet at what price did he buy in at as well (hint: it was roughly around $54 a share during the big dip back on february).
Swing Trade Swag : so you see, the smart investor of any kind would pull back the charts a bit to YTD, weekly, or even daily to see that 52-54 is a well defined key support area. combine that with an RSI indicator to confirm oversold levels and in a few weeks to months, sell just prior to resistance levels and pocket a nice gain :)
side note: please excuse my sarcasm, just some constructive criticism!
Swing Trade Swag Sam White: you could stake your crypto... kind of like dividends except better lol