Some thoughts along the road to wealth

The Ticker

November 28, 1997|By JULIUS WESTHEIMER

TURKEY leftovers:

WARNING: "Investors are turning more and more to technical analysis. This is analogous to consulting a fortune teller." (Laszlo Birinyi in Forbes, Dec. 1)

CHECK'S IN MAIL: "Dividends really do matter, contributing a huge part of your overall return. The S&P 500-stock index climbed 3,052 percent since 1970. Strip away dividends and it's up just 1,025 percent." (USA Today)

ACORN TO OAK: Start early! If you put just $25 a week into stocks that gain 10 percent a year-- that's under the 10.5 percent average annual stock return over 70 years -- you'll have over $103,000 in 22 years. And you invested only $28,600.

LOOKING BACK: "Stocks have reached a permanently high plateau. I expect to see the stock market much higher in a few months than it is today." (Yale economics Professor Irving Fisher, on Oct. 15, 1929, two weeks before the 1929 crash that sent the Dow Jones average down from 381.17 to 41.22, or 88 percent, in three years. The Dow did not recover to its pre-crash level for 25 years.

DEJA VU? "Stocks are ending a significant correction within the overall bull market. The trend will be up for at least the next 10 months and will carry the undervalued market at least 50 percent higher, to around Dow Jones 11,700." (Bob Carver's Market Clues)

SENIOR CIRCUIT: If from age 20 to age 65 you save $50 a month and get an annual 8 percent return, at age 65 you can take out $1,658 every month until age 100.

TIME RUNNING OUT: "Before 1997 passes you by, consider these smart ideas for making -- or keeping -- more money in 1998," says Kiplinger's Magazine. The article suggests: Pick stocks carefully; lighten up a bit, claim your tax cut, sell some winners and diversify even more.

TAKE THAT LOSS: "Even the best stock lists have holdings that don't work as well as expected. Selling stocks at a loss seems counter-productive, but it makes sense if you replace losers with stocks having better prospects. Use the capital loss to offset gains that are realized for the same year." (Personal Finance)

LOCAL HIGHLIGHT: At midweek, BGE stock landed in the yearly "new high" listings, reaching $30 a share. Within the last year, you could have bought the stock at $24. The local utility yields 5.6 percent, more than double the current inflation rate.

STAY THE COURSE: "Investors who did not bail out of stocks after the Oct. 19, 1987, 508-point crash have earned 168 percent by 'hanging in there.' " (Money, November)

LOOKING AHEAD: December is historically the best Wall Street month, with the S&P index rising an average 1.8 percent. January ranks second, up 1.6 percent.

Pub Date: 11/28/97

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