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Adding Wal-Mart (WMT) To My DRIP Stocks

13 May 2010 One Comment

Back in March, I mentioned that I was adding McDonalds (MCD) as a DRIP to my overall investment picture.  Today, I’m announcing that I’ve also added Wal-Mart (WMT) as a DRIP to my portfolio.  For each of these holdings, I have it setup to automatically withdraw a set amount from my bank account each month and invest it in shares of these holdings.  Also, the dividends auto-reinvest so it is a great way to accumulate positions over time.  For new investors, DRIP means Dividend Re-Investment Plans.

The thesis is the same for buying Wal-Mart as it is with McDonalds.  I think both stocks will perform well over the coming years since I believe the economy will continue to struggle and Americans will opt for low-cost options with regards to basic necessities like food.  Both stocks have a great track record of increasing dividends.  Both stocks are fairly high as most stocks are currently, but they will hold up well should the market correct.  I’m not too concerned with the stock price of these positions as I’m looking to slowly build a long term position no matter what the stock price does in the short term.

These are pretty much the only two stocks (maybe Philip Morris Int’l is a third) that I can say that about.  Any other stocks and I’m basically waiting for a larger pullback in the stock market.

If you’re new to investing and looking to build positions in quality companies, DRIP plans for companies like Wal-Mart and McDonalds are great ways to get into the game.  Plus, they are essentially the cheapest with very low fees.

Also, just a heads up, I’ve recently updated my Major Trends page including details on my DRIP investing.  I encourage you to check it out.

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