miércoles, 20 de septiembre de 2017

Crisis of the retail sector

Crisis of the retail sector

Welcome brothers to a new video of my channel brothersindividends, I invite you to subscribe to my channel so you will get new videos as soon as I finish them!

In today's video we'll talk about the malls, the enormous american shopping centers that are in the middle of a considerable crisis, a crisis that might soon reach the rest of the world.
That being said, the term crisis here is relative, as the US still dedicates 5 times as much surface to shopping centers per citizen compared to Europe or Japan.
Still, it is undeniable that the sector is undergoing profound change: while online shopping is growing by 15% yearly, sales in malls are barely achieving a growth of 2%.
Retail chains like Sears have lost in the last few years 10 billion dollars.
Macy's will close 68 shops this year, and they might not be the last.
But just as there are losers, there are also winners in this shopping war.
On one hand, Amazon, whose ascendancy might only be just starting.
And Walmart, whose cheap prices policy keeps it competitive with online shopping, at least for now.
So, brothers, as always, everyone is responsible for  their own money and should reach their own conclusions, but as for me, I'm wary of the retail sector right now.
It is an excellent business and I'm interested in having a percentage of my portfolio invested in it, but I think there will be great winners and also great losers in the long term in this sector, so choosing wisely in which company to invest in will be key.
Whatever you do, best of luck in your investments!

martes, 19 de septiembre de 2017



Welcome to my video channel, if you like this video please drop a like so it can reach more people, and follow me if you want more like it.

In this and other videos I will explain my investment strategy and analyze companies I would like to invest in, I firmly believe my system is a great winner in the long term.
In few words, I invest in excellent high dividend yield companies, and reinvest the dividends they provide in buying more shares, making the compound interest work in my favour; what at first means small increments to the initial investment, after a good amount of time it results in enormous amounts of money.

My investment strategy is very similar to that of a rancher, but instead of investing in cows, I do so in companies.
While a rancher would invest in good cows that grow strong and produce a lot of milk, I want to invest in large, reliable multinational companies that are big earners, and thus, are able and willing to consistently provide their investors with a juicy dividend.
So, what are these cows I speak of?

I only invest in companies, not bounds or any other product.
In particular, I choose some of the largest multinational companies in the world, with very large revenues and that offer dividend yields over 4 or 5%.
It is important that all those conditions are met since I am a long term investor: once I buy a company I rarely, if ever, sell, unless I clearly identify a bubble or the company is cyclic , so I require companies that will continue to be great investments for decades.
The best of these companies are the so called dividend aristocrats, a group of american corporations that are such great, solid earners they have been increasing their dividend yields for over 25 years.

One of the most important factors as long term investor in the stockmarket is buying these shares at reasonable prices.
Buying them when they are overpriced not only reduces the amount of shares I can acquire, but the dividend yield would also be proportionally lower.
That being said, there is also a cost to waiting outside the market, as that money isn't producing dividends that I can then reinvest, so a balance must be kept between the amount of time spent waiting for opportunities and missing out on a constant dividend.
As with the example of the cows, I want to buy as many cows as possible so they can produce the most milk, which I will then use to buy even more cows and pay for my living expenses,
but the timing of this purchase must be balanced with the cost that waiting for the perfect buying price means in lack of milk production and reinvestment compared to an earlier cow purchase.

One of the main problems for long term investors is fear, shares rise and fall, and it's hard to accept when your hard earned money is theoretically becoming less and less as the share you invested in falls.
My investment strategy requires for me not to care about such temporary losses,
as I shouldn't as much care about the current price of the share as I do about the real strength of the company, and how much dividend yield I'm getting from the money I invested in it.
 This is, again, because I am a rancher, and a rancher's main concern is that his cows are healthy and continue producing milk, not how the market currently values cows he isn't planning to sell.

This is easier said than done, I've had companies I invested in lose almost a quarter of their buying price.
It was difficult to keep a clear head when I saw all that money evaporate, and fight the urge to sell and cut my loses, but in those times is when I have to remind myself of the system, and how I took into account such circumstances and how in the long term it will still provide a benefit.

More and more people are discovering the profitability of long term investment in high dividend yielding companies,
so if you follow a similar system or are considering to do so, follow my channel for further videos along those lines.
I also appreciate any likes as those help spread word of my videos to more people.

Welcome to the brotherhood of the dividend earners, and have a nice day!