There has never been a better time to invest. Every spare dollar can get you a whole lot more once the world starts getting back to normal after the Corona-virus pandemic.
But that’s a long way off, and money can be tight right now. Especially if you invested before the stock market took that plunge after COVID-19 started affecting peoples’ daily lives in a very real way; people lost jobs, started working from home, social distancing.
But that plunge in price means it’s a good time if you have extra money to start looking at the stocks that will recover the most once COVID-19 is taken care of, and a pretty good time to look at what stocks are working right now such as messaging and communication companies. Whatever your strategy, these times of down-turn are a great time to do some research and buy in where you see opportunity, because the likelihood is that things will start going up once a real view of the future is determined by the powers that be.
Me? I don’t have a lot of extra to invest. I moved most of my money out to a high-dividend yield stock, WPG, many months before the pandemic, and that stock has suffered huge losses because it’s a mall REIT. It cut it’s big dividend in half with the emergence of COVID-19, although it is still paying fairly well. Regardless, that drop in stock price was a huge blow, a loss of around 40% of it’s value on top of average lower daily value over the 2 months prior. Over the last 3 months, I have lost over 74% of value on this stock alone. In another 2 months I’ll get $237.50 in dividends (instead of $475), for a total of $950 for the year. That is nothing to scoff at, still, but it would take 5.5 years of these dividends to recoup the loss of the stock price. But that’s if the stock price doesn’t change.
As WPG pushes to re-purpose their portfolio of real estate in this pandemic, they are also setting themselves up for success in the future. If the stock price of WPG ever returns to my average cost of $4.00, I’ll be sitting on nearly what I put in to buy the stock plus all the dividends I have received since I purchased the stock.
Not only that, but I have ongoing payments every month of $50.00 to Exxon Mobil (XOM) which has gone up 11% in the last month (though down 29% over the last 3 months) and $100.00 to Realty Income (O) which has gone down 10% in the last month and down 34% in the last 3 months. Am I concerned with these purchases? Not really. My dividends from these investments are in a DRIP (Dividend Reinvestment Program) directly from the companies, meaning any dividends I get from them are automatically reinvested into that company for more shares. This DRIP plus monthly installments will increase my overall portfolio for these stocks, and when things go back to normal it is my hope that these stocks will perform better. Not only that, but purchasing them now means when they go up, I will get more back than if they hadn’t been affected (or worse, gone up) during this pandemic. These increases from purchasing low may only offset the losses when it was purchased high, but the only way to know is to see where it goes after the pandemic settles.
I didn’t really look into stocks that would do well during this pandemic back when it was starting because of the loss I already had on my WPG stock (withdrawing would have meant locking in a huge loss). Instead, I plan to keep my investment where it is until it yields favorable returns (which is likely years away). This long-term look is something I have talked about before but never really put into practice, because I’m impatient and easily influenced by seeing big losses. But I need to be patient, because nothing good will come out of this without it.
I didn’t lose my job, I’m working from home and keeping safe, and I can pay all my bills just fine. I’m in a much better position than a lot of people today, which I am thankful for, but that doesn’t mean I’m going to get complacent. I will continue to watch where everything is heading, because you never know when something will change to your benefit (or detriment).
Stay strong, everyone!
A Beginner's Experience With Investing 