Consider adding some core stocks

The Ticker

September 09, 1998|By Julius Westheimer

Where should you invest -- and not invest -- your money now?

Coca-Cola Co., General Electric Co., Merck & Co. Inc. and Procter & Gamble Co. are listed as core stocks for long-term appreciation by S&P Outlook.

The AAAI Journal says, "Try the 'Dogs of the Dow' approach. This strategy advises buying the Dow's highest-yielding stocks, namely out-of-favor, underpriced blue chips. Dow stocks represent large firms with management depth and strength to recover from short-term stumbles."

"There's still some room on the downside, with more bad sessions possible -- but we're nearing bottom," says Seth Glickenhaus, stock adviser.

SCANDALS and STOCKS: "During the Nixon Watergate scandal, October 1973-October 1974, the Dow Jones average plunged 40.8 percent. During the Reagan Iran-Contra scandal, August-October 1987, the Dow fell 36.1 percent." (Smart Money.)

WARNING: "Tempted by those ads for investment seminars that promise to make you rich quick? Someone will definitely make money -- and the Federal Trade Commission says it will probably be the seminar huckster who takes yours." (Kiplinger's Personal Finance Magazine.)

CAN DO BETTER: "Right now, the new inflation-indexed savings bonds yielding 3 to 3.5 percent don't look attractive. With inflation low, you can do better elsewhere. Short-term government securities are earning roughly 4 percent above the inflation rate -- 'real return' to the bondholder." (Financial Planning Perspectives.)

Pub Date: 9/09/98

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