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Investing Tips From Kevin O'Leary

You might have of hear about Kevin O’Leary from his appearances on the TV program, Shark Tank, about funding start-up companies. But did you know he has a net worth of around $400 million ass the founder of O'Leary founded O'Leary Ventures, a private early-stage venture capital investment company.

Here are the three simple rules Kevin uses for buying stocks. If you follow these rules you can make investing really simple for yourself.

First, buy quality companies with strong financial performance and solid balance sheets. You could start with the 30 or so stocks in the list of Dividend Kings, for example. Dividend Kings have at least 50 years of paying out to shareholders an increasing dividend every year, an indication a strong performance, good management and a balance sheet that remains solid year after year. Dividends might be boring but it’s one indication that a stock is in good shape. Several web sites have information about the 31 stocks in the list of Dividend Kings, but I like the information at

Second, as you develop a portfolio it should be diversified across different market sectors.

The simple way to do that is to buy a great Exchange Traded Fund, for example, the Schwab US Dividend Equity ETF ( SCHD) is a great choice due to its low cost and focus on just 100 of the best dividend stocks. Another top choice is the Vanguard Dividend Appreciation ETF (VIG), which has over $50 billion in total assets. The fund holds 180 of the best dividend stocks in the U.S. mostly the stocks that are considered large cap stocks (shares that trade with a market capitalization of $10 billion or more. Large-cap stocks are often less volatile when stocks drop in value). Both ETFs focus on strong companies paying out good dividends. Other great ETFs to hold include:

  1. ProShares S&P 500®Dividend Aristocrats®ETF (NOBL) is the only ETF focusing on a rare breed of companies within the S&P 500 that have raised their dividends for at least 25 consecutive years.

  2. SPDR S&P Dividend ETF (SDY) holds stocks that have increased dividend payouts for at least 20 year and that are included in the Dividend Aristocrats Index.

  3. iShares International Select Dividend ETF (IDV) this international iShares fund offers stocks from around the globe while excluding U.S. corporations. Great way to gain some returns from the global stock market.

Third, and perhaps most important, O'Leary demands income—his target is to buy shares in stocks that consistently pay increasing dividends to shareholders, like the companies on the list of Dividend Aristocrats list. maintains a list of 60 or some stocks in the list of dividend aristocrats (Companies in the S&P 500 index that have increased dividend payouts every year for at lest 25 years.)

If you watch CNBC, Keven O'Leary is often featured, commenting on stock and his investment philosophy.

Floyd Saunders is the author of Figuring Out Wall Street. His next book, Five Simple Paths to Wealth will be published in March. You can learn more about him at his author web site.


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