10 tips for creating wealth from the stock market:

1. Do not spread your money too thin.

My friend has a little over $200,000 invested in the stock
market through 27 different Mutual funds. In my opinion, 27
Mutual funds is 27 too many collecting load fees, management
fees, commission fees, operating and advertising fees. Diversity
is important, but just as important is over-diversification.
Also, in my opinion, $200,000 should not be put into more than
12 stocks, let alone 27 different Mutual funds.

2. Do not pay commission fees to purchase a stock.

If you are going to invest your hard earned dollars into a
company, the least the company could do is provide you a way to
invest in their company commission free "� and they do!

3.Only purchase those companies that pay a dividend.

The same company that you invest in commission free should also
offer you another incentive for you to invest "� a dividend for
the use of your money.

4. Only purchase those companies that have a history of raising
their dividend every year.

The same company should continue rewarding you for your faith in
their company by increasing the amount of their dividend every
year. Rising dividends are also the proof that the company is
doing something right.

5. Dollar-cost average into each stock position.

By dollar-cost averaging (buying the same stock at different
prices through the years) you"ll never pay too much for the
company"s stock, even if the initial purchase is at a 52 week
high. Have all the dividends from each company rolled back into
more shares of each company, until retirement. The companies you
invest in should do this for you, automatically, commission free.

6. Forget making a profit; instead focus on the income provided
from your stock portfolio.

That"s right! Forget making a profit. The burden is now lifted -
no more pressure on making a buck in the stock market (Instead
of trying to bend the spoon, that is impossible, instead just
think of the spoon as "� omigosh! - I"m in the Matrix). When you
focus on the amount of money your holdings are providing in
dividends "� and when those companies selected have a history of
raising their dividends each year "� a lower stock price allows
the dividends that are being rolled back into the stock to
accelerate your income. The total value of your portfolio may go
lower, but your income from the lower priced portfolio would
increase dramatically. Profit by income!

7. Make every stock purchase with the intent that the purchase
will be a long-term investment.

Do not trade in and out of your holdings. There have been many
up and downs in the stock market. The down markets only
accelerate your income. GE has raised their dividend for 28
years in a row. Why sell it? 100 shares of GE ten years ago has
turned into 1200 shares today due to stock splits, and that is
not counting how many shares you would have now if the dividends
were being rolled back into more shares of the stock through
those years.

8. Understand that a lower stock price, after your initial
purchase may be a blessing in disguise.

The income from your stock holdings should grow every quarter,
no matter what the total amount of your stock portfolio is
worth. (If your Mutual fund declines in price from one year to
the next and if your income is not increasing (accelerating)
from that fund, why are you in that fund?) A company pays their
dividend not on how much their stock is worth in the market
place. For example, a company pays a quarterly dividend of 50
cents a share. A company has little control on how much its
stock price is worth in the market place on any given day. You
will receive 50 cents a share per quarter whether the stock
price is at 50 dollars a share, or drops to $40 a share or goes
up to $70. While the stock is down at $40 a share your dividend
reinvestment is loading up on more shares.

9. Develop a savings plan to add to your holdings each quarter
to help your dividend reinvestments to accumulate more shares on
a dollar-cost averaging basis.

The savings could be as little as $5.00 a week. Why put that
savings in a savings account at 1.2 percent, when there are so
many companies out there that are paying a 4 to 5% dividend
yield and increasing their dividend every year? And since none
of the companies you are investing in charge a commission fee,
all of that $60.00 a quarter you saved and invested would help
your dividend reinvestments to dollar-cost average into your
holdings. Every cent you save and invest would work toward your
ROI (Return on Investment).

10. Read my book "�The Stockopoly Plan" soon to be released by
American Book Publishing.

I believe it will profit you and your family for the rest of
your lives.

For more excerpts from the book "�The Stockopoly Plan" please
visit http://www.thestockopolyplan.com

About the author:
Charles M. O"Melia is an individual investor with almost 40
years of experience and passion for the stock market. Author of
the book "�The Stockopoly Plan", soon to be released by American
Book Publishing.

Author : Charles M. O'Melia
Site : www.goarticles.com

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