That’s what happened to me when I took a graduate-level class with one of my mentors in technical analysis, Dr. Hank Pruden.

For those of you who are unfamiliar with the term “technical analysis,” it refers to analyzing a market or an individual asset using charts.

I was expecting to learn about trend lines, bullish and bearish patterns, cycle analysis, etc., in this class. But instead, we dove deep into the psychology of the markets, trying to understand what motivates investors and traders to act the way they do.

Today, there are many institutions that teach behavioral finance, but at the time, it was groundbreaking stuff.

One of the most important concepts is that investors’ behaviors repeat time and time again. There are no guarantees, of course, and every situation will be a little different, but humans can be fairly predictable.

We typically fear the worst just before things get better… and we expect things will always be this good just before they get worse.

This course taught me a number of key ideas that I still use nearly three decades later. Here are a few of the most impactful ones.

Confirmation Bias

Confirmation bias occurs when you focus only on the information that confirms your beliefs. People do this with their political beliefs all the time, and the media plays into it by exclusively giving them information that aligns with their point of view.

In the markets, an investor may believe that a stock is a great buy because they see the company’s products everywhere… which may cause them to ignore the fact that the stock has been in a downtrend all year. Despite the market signaling that things are not great for the company, the investor buys the stock anyway.

Overconfidence

I’d bet almost everyone reading this believes they’re a better-than-average driver. In college, I had an argument with a friend about what a horrible driver he was. “How many cars have you totaled?” I asked. (The number was three in the previous four years.) “Yeah, but they were all somebody else’s fault!” he exclaimed.

Enough said.

When things are going well in the markets, investors often confuse a bull market with their own genius and think they’ll know when to get out. Of course, it doesn’t work out that way.

The Herd Effect

How many times have you been looking for a place to eat and walked past an empty restaurant to wait at a crowded one?

We’ve seen this time and again in investing, like when people piled into dot-com stocks, crypto, cannabis stocks, and meme stocks because that’s what everyone else was doing.

Being aware of these concepts can help you question your own decision making and ensure that you’re thinking critically about each buy and sell.

You can also use stock charts to test your opinion.

For example, in early 2021, AMC Entertainment Holdings (NYSE: AMC), the poster child for meme stocks, took off. The stock moved from the $20s (split-adjusted) to over $600 in a few months.

And keep in mind, this was not some new tech company or a biotech that had a cure for cancer. AMC is a movie theater chain. And you’ll recall that in 2021, no one was going to the movies. So it made no sense that everyone was piling into the stock.

Let’s say you were on Reddit or some other message board reading about AMC and all the reasons it should go higher. One look at the parabolic move on the chart would tell you to be very careful… because when the stock stopped going higher, it was likely going to reverse quickly.

Technical analysis is simply the visual representation of investors’ emotions. The more aware you are of those emotions and behaviors and how to interpret them, the better a trader and investor you’re going to be.

The post 3 Lessons Every Investor Should Know appeared first on Wealthy Retirement.

Our New Year’s resolution in Wealthy Retirement is simple: Continue to deliver insights that can help you prepare for – or improve – your retirement and move one step closer to financial freedom.

One way you can help us do that is to share your feedback.

Could you please take a moment to answer a few questions about your experience with Wealthy Retirement?

It will take less than 60 seconds, and it will help us serve you and your fellow readers even better in the new year.

Thank you in advance!

– James Ogletree, Senior Managing Editor

There’s something about the start of a new year that flips a switch.

A clean slate.

A fresh calendar.

And a chance to finally level up a skill you’ve been meaning to master.

That’s why we’re starting the new year with something truly special…

We’re thrilled to announce an Oxford Club exclusive partnership with Peter Tuchman – widely known as “The Einstein of Wall Street” and the most photographed broker on the New York Stock Exchange – alongside veteran trader David Green of Wall Street Global Trading Academy.

If you’ve ever watched market coverage, seen iconic NYSE photos, or followed the pulse of Wall Street over the past few decades…

You’ve seen Peter.

Now, for the first time, Oxford Club readers are getting direct access to him and his business partner David in a FREE live masterclass kicking off the new year.

• Tuesday, January 6
• 8:00 p.m. ET
• Free – Oxford Club Exclusive

This isn’t about chasing flashy predictions.

It’s about building a real, rules-based foundation – the kind of knowledge that helps you approach the market with clarity, discipline, and confidence.

In this New Year masterclass, you’ll learn:

• How day trading actually works (no myths, no hype)
• What it really costs to get started
• Core principles of technical analysis
• Risk management techniques professionals use to survive and stay consistent.

If one of your New Year’s resolutions is to:

Then this is a powerful way to start.

It’s completely free to attend.

Just click below to add it to your calendar, and we’ll handle the rest.

Add to Calendar (Free Masterclass)

We’re incredibly excited to kick off the new year with The Einstein of Wall Street and Wall Street Global Trading Academy – and even more excited to have you there live.

Here’s to a smarter, more intentional 2026,

Rachel

The post Learn From “The Einstein of Wall Street” appeared first on Wealthy Retirement.

The most important element to investing success is not stock-picking ability – it’s time. The longer you’re invested, the more money you will make.

Consider this…

A $10,000 investment in dividend growth stocks with a starting yield of 4%, dividend growth of 8% per year, and price appreciation that rises in line with the historical average of the S&P 500 is worth $17,757 after five years.

After 10 years, it’s worth $31,572.

After 15 years, you’re sitting on $56,208.

At year 20, your $10,000 has turned into $100,195.

Hold for another 10 years, and you’ve got $319,613.

And if you stayed invested for 40 years, you’d have $1,024,893.

That’s the power of compounding and time.

Legendary investor and trader Jesse Livermore once remarked, “It was never my thinking that made the big money for me. It was always my sitting.”

In fact, a Fidelity study commissioned years ago looked at its accounts to see if it could identify common traits among its most successful investors. What it found was remarkable.

The best-performing accounts belonged to investors who either were dead or had forgotten they had accounts.

Among the thousands of accounts that Fidelity looked at, the ones that just sat there – that weren’t touched – had the best results.

The biggest favor you can do for yourself as an investor is to put money into stocks and then do nothing (or very little) for as long as possible.

And if you want to leave a legacy for your children or grandchildren, do the same for them.

Can you imagine how you’ll be remembered if your grandchild has an account that you set up 40 years prior, and that money – which may not have been much when you funded it – can now help them buy a house, fund their child’s education, or even set up the next generation the way you did?

They say that in life, timing is everything.

But in the market, what’s more important is time. Regardless of how tough the markets might be, give yourself and your family the gift of time for your investments to grow.

The post How to Make Millions by Doing Nothing appeared first on Wealthy Retirement.

It’s the kind of result everyone who’s ever been involved in a startup dreams of.

I’m happy for him. He’s worked incredibly hard over the past 10 years and spent a lot of time on the road away from his family.

But he could have done even better.

Let me explain.

When he started, he was given a small percentage of the company. But he also invested his own money in the business in order to hold a larger stake.

He invested $250,000 and will just about double his money.

However, had he simply put that money into the S&P 500, it would now be worth $723,750.

My buddy put a decent amount of his net worth into one new and speculative company. If he’d invested in the S&P, he’d be betting on hundreds of America’s best businesses.

Perhaps he wouldn’t have known to select Nvidia (Nasdaq: NVDA) as a stock to buy 10 years ago. But by owning the S&P 500, he would have had exposure to it as it became one of America’s hottest companies and stocks. He’d also have owned huge winners like Microsoft (Nasdaq: MSFT), Apple (Nasdaq: AAPL), Eli Lilly (NYSE: LLY), Costco (Nasdaq: COST), and many others.

He would’ve experienced the power of compounding dividends as well. Over the last 10 years, dividend income was responsible for 23% of the market’s total return. That’s consistent with the 24% of the S&P 500’s average monthly total return that dividends have accounted for since 1957.

By betting $250,000 on that one company, he missed out on roughly 23% more returns by the simple fact that he wasn’t paid a dividend like he would’ve received from the broad index.

I see investors make similar mistakes all the time as they try to pick the right stocks. Sure, owning top-performing stocks can be lucrative (and I’ll admit that it’s fun owning individual stocks). For most people, however, owning a diversified group of index funds or ETFs is the best way to go.

Markets go up over the long term, and if you own the broad indexes, you’ll participate in those gains. But if your focus is too narrow, you have a good chance of missing out.

Make sure you’re receiving some dividends too. They will substantially boost your return over the long term, and they make bear markets easier to handle when they occur.

If my friend had asked me what I thought before he committed that cash a decade ago, he’d be sitting on about a quarter of a million dollars more – and he would’ve had a lot less stress about whether he was ever going to get his money out.

Investing doesn’t have to be complicated. Own the broad indexes and collect dividends. Over the long term, your returns will be strong and your stress will be lowered.

The post My Friend’s $250,000 Mistake appeared first on Wealthy Retirement.

At the end of each month, my meager paycheck was basically gone. I decided I needed to learn about the stock market to make some money.

I read everything I could get my hands on. I spent many Saturdays at the New York Public Library absorbing as much as I could. (This was before the whole world was available on the internet.)

Soon I started trading and investing in stocks. And then my mind was blown when I discovered options.

Like most people, at first, I saw options as a shortcut to quick riches. Fortunately, I knew that I didn’t know what I didn’t know (ya know?), so I didn’t start trading options until I had a better understanding of them.

But even then, I was only buying puts and calls as speculations.

A put is a bet that a stock will go down. A call is a bet that it will rise. These option contracts allow you to control 100 shares of stock for pennies on the dollar for a specific amount of time.

For example, if you thought Bank of America (NYSE: BAC) was going higher in the short term, you could buy 100 shares for about $5,250. If the stock rose 10 points, you’d make about $1,000.

Or you could pay just $325 to buy a call that expires in March with a strike price of $52.50. That means if the stock is below $52.50 at expiration, your call expires worthless. If it’s above $52.50, the call will have value, depending on how high the stock rises and how much time is left until expiration.

If Bank of America shoots higher next week and is trading at $62.50, 10 points higher than it is today, your call would probably be worth around $1,100. So you’d be up $775 on a $325 bet.

If you’d bought the stock, you’d have risked $5,250 and made 19%. By buying the calls, you risked only $325 and made 238%.

You can see why people speculate with options. You risk less and can make a much higher percentage return.

But, as I dug deeper into options, I learned something stunning: The real money in options is in selling them, not speculating with them. When a speculator buys a put or a call, someone has to sell them that option – and they get paid to do so.

Big financial institutions generally aren’t trying to hit home runs buying calls on Nvidia (Nasdaq: NVDA) and taking on that risk, but they’ll be happy to sell you some.

The more I understood this, the more I wanted to sell options to generate income right away.

Now that I’m older, while I still like to swing for the fences once in a while, my priority for my investments is generating income.

Over the past decade, I’ve increasingly used options to generate income with various strategies, including (but not limited to) covered calls and naked puts.

A covered call is when you own a stock and sell a call on it. In other words, someone is betting that the stock will go higher. When you sell the call to them, you get paid immediately. If the stock goes higher, you may have to sell your stock at the higher strike price, but you keep the money you got from selling the call.

If the stock pays a dividend, you can also continue to collect those dividends while you wait, which further boosts your return.

Then there are naked puts. When someone is worried about their stock going down – or speculating on a fall – they’ll buy a put. If you sell them a naked put, you are agreeing to buy that stock from them if it reaches the strike price. (In options trading, “naked” simply means you don’t own the stock already. “Covered,” as in covered calls, means you do own the underlying stock.)

Let’s say you’re interested in buying a stock, but only if you can get it at a 10% discount.

You could sell puts on that stock with a strike price 10% below the current price. That means if the stock drops by 10%, you will likely get to buy 100 shares of the stock at your target price. You also got paid for selling the put, which lowers your effective cost even more.

If the stock never drops to your target price, you still keep the money you received upfront when you sold the puts.

I’ve come a long way since spending my weekends in the library. The time was well spent, as I now have a number of ways to put extra cash in my pocket. Had I sold options 35 years ago, I could have gotten out of that dumpy apartment a lot quicker – and eaten a lot less ramen.

The post I Use These Strategies to Put Extra Cash in My Pocket appeared first on Wealthy Retirement.

My great-grandfather traveled from Europe around the turn of the 20th century because, like many, he’d heard that the streets in America were paved with gold. It was a place to get rich.

He didn’t. He found work as a cigar-roller, but his family was poor. All of his kids worked when they were young (they got younger each time my grandfather told us the story), and the ones who went to high school and college did so at night so they could work during the day and contribute to the family.

Yet at the time of my great-grandfather’s death in the 1960s, my grandfather – along with his brother – owned a seat on the New York Stock Exchange.

From being crammed into a tiny tenement apartment to a seat on the NYSE… in just one generation.

The American Dream.

Today, an increasing number of people believe the American Dream is not attainable. In fact, according to recent polls, 70% believe the American Dream is dead. It makes sense. Through social and mainstream media, we are fed an endless loop of terrible news, bickering, and finger-pointing.

When we’re seeing that day after day, why would we believe that we live in a prosperous place where nearly anything is attainable?

However, in his new bestselling book, The American Dream: Why It’s Still Alive… And How to Achieve It, Chief Investment Strategist Alexander Green pulls back the curtain to prove that there has never been a better time to go after the American Dream.

Alex is no Pollyanna. He recognizes we have real problems that need to be dealt with. But, using hard data, he shows that the economy is still on solid footing, violent crime is down, opportunities for women and minorities are up – and a host of other facts that you’ll rarely hear on the news or on your Facebook feed.

As I was reading it, I kept highlighting passages, thinking, “I want my two young adult children to read this.” I found the chapter titled “Things Aren’t What They Used to Be… and That’s a Good Thing” particularly inspiring.

Most importantly, after proving that the American Dream is still attainable, Alex shows you how to do it.

Not everyone is going to start the next Microsoft and be a billionaire. But that’s OK. That’s not everyone’s dream. For most, the dream is simple: Own a home, have enough to retire on, visit the kids or grandkids, donate to a favorite cause, and not stress about money.

The nice thing about that dream is that it is not terribly difficult to attain. If you follow the advice in the book, it’s almost hard not to achieve it. It may not always be easy, but it’s not supposed to be. It requires some work, which has always been the foundation of the American Dream.

Nothing is handed to us in this country. That’s what makes it so great. (If you think free or government-subsidized stuff is so wonderful, ask anyone who lived in a socialist country.) It’s why – despite increasing hurdles – people from other countries continue to try to move to the United States. They’re willing to work hard in order to chase their version of the American Dream.

Alex’s book is a great reminder that despite the avalanche of negativity bombarding us from all sides, things are actually still pretty darn good. Could they be better? Of course – and you can be sure there are millions of Americans trying to make them better in their pursuit of their own American Dream.

I encourage everyone to read The American Dream: Why It’s Still Alive… And How to Achieve It. You’ll be inspired and armed with strategies that will help you or your loved ones reach your own version of the dream.

Good investing,

Marc

P.S. Today is the book’s official release date, so don’t waste any time ordering your copy. You can do so on Amazon right here.

The post The American Dream Is More Attainable Than Ever appeared first on Wealthy Retirement.

That’s the question I asked my cousin Dave a few years ago when he requested investment advice. He wanted to know about different asset allocation strategies that were all heavily weighted toward stocks.

Dave is investing for years down the road, but he’s a worrier. I can talk all day long about how markets go up over the long term… or how you would have made money 93% of the time over rolling 10-year periods since 1937… or how the only time you wouldn’t have made money over 10 years was if you sold during the depths of the Great Depression or Great Recession.

But none of that matters when your portfolio is down 30% because you’re in the middle of a bear market a few years after you’ve invested.

(Note: I’m not calling for a bear market in the near future. I don’t have a crystal ball. I’m simply pointing out that bear markets happen and that one probably will occur at some point.)

So I talked to Dave about investing in Perpetual Dividend Raisers (stocks that raise their dividends every year), index funds, and actively managed mutual funds. I discussed the pros and cons of each, including managing the money himself versus turning it over to an advisor.

I encouraged Dave and his wife to have an honest conversation about what they would do if the market headed south. Otherwise, the fact that the S&P 500 has a 10-year average total return of 140% over the past 40 years will be meaningless, as they may not be able to handle the volatility.

If they are invested in the market without the proper risk tolerance and the market slides, they will no doubt sell into weakness, probably near the bottom like so many other investors.

When you hear about people who got their clocks cleaned in 2008, it’s usually because they panicked and sold. I’m not judging. The panic was understandable. We narrowly escaped financial Armageddon. (That’s not hyperbolic. The entire financial system was on the verge of collapse.)

But investors who held on were made whole fairly quickly. Even if you bought at the very top in 2007, your portfolio was back to where it started by early 2013.

It’s easy to be rational when stocks are moving higher (as they are today) and say, “I’m in it for the long term.” But like Mike Tyson accurately stated, “Everyone has a plan until they get punched in the mouth.”

If you were in the market in 2008, think back to those dark days and consider whether you could handle a repeat of that experience. If you were not invested then, imagine what it would be like if your portfolio were cut in half. Would you have time to make it up? Would you be able to sleep at night? Would you be able to take it on the chin?

If the answer to any of those questions is no, get into safer assets like bonds, CDs, and money market accounts today.

If a downturn wouldn’t have you up against the ropes, stay invested, confident in the knowledge that markets go up over the long term.

Good investing,

Marc

P.S. What’s the best financial advice you’ve ever received – or advice that you often give to your kids, grandkids, or friends? Drop it in the comments below.

The post Can You Handle Getting Punched in the Mouth? appeared first on Wealthy Retirement.

There are several reasons.

1. A management team that cuts the dividend is likely to do it again.

By reducing the dividend, management has proven that the dividend is not sacred. There are companies that have raised their dividends every year for decades – and others that have never cut the dividend. Those management teams will do everything in their power to ensure that the dividend is not lowered.

A company that has never lowered the dividend (or, even better, raises the dividend every year) projects confidence and sets a high bar for performance.

With track records of solid dividend payments for 10, 20, 30 years or more, these companies would have a lot of explaining to do if the payout to shareholders were suddenly reduced. It would signal that something is very wrong at the company.

Once a company has made the agonizing choice to cut the dividend, each time it does so again becomes a little less painful and a little easier to do.

2. Dividend cutters’ stock performance is awful.

Companies that lower their dividends tend to underperform the S&P 500 by a whopping 15 percentage points over the five years following the cut.

They even underperform non-dividend payers. They have the worst performance and highest volatility by a mile.

3. No one wants a pay cut.

The income that retirees generate from their investments is often an important part of their financial health. If their dividends are being cut or they’re worried about a reduction in income, that can cause a lot of stress and even a change in lifestyle.

While no dividend is guaranteed, companies with outstanding long-term track records of dividend stability and growth can make it easier for you to sleep at night since you’re not as worried about your income.

Dividend cutters have poor performance and higher risk, they reduce the amount of money in your pocket, and they are likely to continue down that slippery slope.

There is almost never a good reason to add a dividend cutter to your portfolio.

The post The Golden Rule of Dividend Investing appeared first on Wealthy Retirement.

It’s a big honor, but if you’ve read any of Alex’s writings over the years, you know that it’s certainly not a surprise.

The most impressive part? The book won’t even be released for another two weeks!

Alex has put a ton of hard work into it, and I think this may be his best work yet.

Go here to preorder it today!

– James Ogletree, Senior Managing Editor

One of the reasons that 70% of Americans say the American Dream is no longer attainable is that they believe achieving it is due to luck… not skill.

Is there any evidence to support this view? You might be surprised.

A few years ago, my friend and colleague Mark Skousen asked if I would debate Robert Frank at his FreedomFest conference in Las Vegas.

I agreed.

Robert Frank is a New York Times economic columnist and the author of several books, including Success and Luck: Good Fortune and the Myth of Meritocracy.

Frank puts forward a thought-provoking thesis in his book: If you have been so economically successful that your income and net worth put you in the top 1% or 2% in the country, the deciding factor was not talent, education, hard work, risk-taking, persistence, resilience or all of the above.

It was luck, plain and simple.

After reading the book, I took an informal poll of family, friends, and neighbors.

What I learned is that, with few exceptions, individuals who have experienced a great deal of economic success believe Frank’s thesis is mostly false.

They believe that hard work and persistence are the deciding factor in wealth creation.

But almost without exception, men and women who have experienced modest economic success strongly agree with it.

Psychologists would say that is because human beings tend to accumulate pride and shun regret. We tend to take most of the credit for the good things we achieve in our lives and blame negative outcomes on circumstances beyond our control.

However, I discovered another interesting pattern.

Self-described progressives tend to agree with Frank’s thesis. Self-described conservatives and libertarians do not.

This goes to the heart of political differences between the two major parties.

Democrats generally feel that economic outcomes in life are primarily determined by your group membership and your circumstances: whether you were born male or female, Black or white, rich or poor, etc.

Republicans tend to feel that, whether the hand you were dealt at birth was better or worse, your economic outcome is primarily determined by your willingness to educate yourself, work hard, and take responsibility for your actions.

This is a generalization of course, but – in my experience – a fairly accurate one.

We hear these thoughts echoed when Democrats argue for sharply higher taxes on “the fortunate” or, in former President Obama’s phrase, “society’s lottery winners.”

Republicans, on the other hand, often talk about “personal responsibility” or how affluence is the result of “earned success.”

The truth, of course, is that good and bad luck play a role in everyone’s life.

For starters, you were incalculably lucky ever to have been born.

We know this because the possible people allowed by our DNA so massively outnumbers the set of actual people.

You were also extremely fortunate to be born in the modern era.

For most of human history, we existed on the brink of starvation in a world filled with danger.

(For most of the last couple hundred thousand years, no one worried about saving for retirement because nobody lived that long. Most people were dead by 25, usually of unnatural causes.)

Even 200 years ago – 6,000 years after the advent of agriculture – 85% of the world’s population lived on the equivalent of less than a dollar a day.

Today approximately 85% of the world’s population lives in developing nations. That means the odds of you being born in the West were 6-to-1 against.

This is a pretty big deal.

As Warren Buffett has said…

If you stick me down in the middle of Bangladesh or Peru or someplace, you find out how much [my] talent is going to produce in the wrong kind of soil… I work in a market system that happens to reward what I do very well – disproportionately well.

Whatever your economic success or political views, let’s give Mr. Frank his due.

You were born against astronomical odds.

Even then, the dead outnumber the living 14-to-1. And 99.9% of these 109 billion people lived lives of incredible scarcity and hardship.

People alive today had just a 1-in-7 chance of being born in the West where democratic government, the rule of law, property rights, first-world infrastructure and education, and the lack of any class or caste system paved your way for success.

Furthermore, if you were born more than 50 years ago and are both white and male, you likely didn’t experience the institutionalized discrimination that would have made your economic success more unlikely.

But then also…

Billions of people have been born in the West – many of them white and male and from middle-class or better backgrounds – and the overwhelming majority of them did not experience the financial success of millionaires or billionaires.

Is it possible that the deciding factor for these individuals – and others like them – was just luck? Is the meritocracy truly a myth?

Let me know your take in the comments.

Good investing,

Alex

P.S. My new book The American Dream: Why It’s Still Alive… and How to Achieve It will be out on November 11.

(It’s available now for preorder on Amazon.)

If you want a copy, please act sooner rather than later.

The post Is Building Wealth All About Luck? appeared first on Wealthy Retirement.

I told him I really liked Texas Instruments (Nasdaq: TXN). “The calculator company?!” he exclaimed. “Yes, the calculator company,” I replied, rolling my eyes.

I explained that while there are still calculators out there with Texas Instruments’ name on them, the company is one of the world’s leading semiconductor makers. And it pays a nice dividend.

He snored loudly, pretending to be asleep.

I then told him about Raytheon Technologies (NYSE: RTX). The government never gets tired of spending money on new toys for the military.

“C’mon, Marc… give me something exciting,” he demanded.

“Okay, how about Digital Realty Trust (NYSE: DLR)?”

I explained that this company is a real estate investment trust that rents out shelf space to household-name companies to place their servers. It generates a ton of cash and also pays a solid dividend.

“Booorrrring!!!” he cried.

Had he invested in those companies, he wouldn’t have thought they were boring at all. Texas Instruments became the second-biggest winner in the history of my monthly newsletter, The Oxford Income Letter, gaining over 450% in 10 years. I sold Digital Realty Trust in 2022 for a more than 220% gain in eight years. Raytheon, now called RTX, is still in the Oxford Income Letter portfolio and is up 792% since 2013.

But my friend wanted something tiny that could really move.

There’s a misperception in the market that low-priced stocks can move faster than high-priced stocks.

Tell that to anyone who bought Nvidia (Nasdaq: NVDA) at $400 or Goldman Sachs (NYSE: GS) for $300 two years ago. They’ll laugh in your face. Goldman Sachs has more than doubled to $760 since then, and Nvidia has more than quadrupled (it underwent a 10-for-1 stock split in 2024).

Still, there is something exciting about owning a lot of shares of a low-priced, very small company. And when tiny companies move, they can move fast.

Look at RedCloud Holdings (Nasdaq: RCT). It was trading between $1.40 and $1.70 in June of this year. But by July 1, it had tripled to $4.29.

PepGen (Nasdaq: PEPG) recently doubled – from below $2 to over $4 – in just a month.

And Dominari Holdings (Nasdaq: DOMH) skyrocketed nearly 13X, rising from $1 to $13, from mid-January to mid-February.

That’s the kind of action most people who get involved in microcap stocks are looking for.

And there’s nothing wrong with that as long as you know the risks and position size accordingly.

Many investors don’t know this, but you can also find microcaps that pay dividends.

For example, Kimbell Royalty Partners (NYSE: KRP) has a market cap of just $1.4 billion and yields almost 12%.

And $30 million market cap Crown Crafts (Nasdaq: CRWS) sports an 11% yield.

That brings me to another point: Microcaps don’t have to be startups that have recently gone public or are involved in Bitcoin or some other speculative technology.

Crown Crafts makes baby furniture and has been around for almost 70 years.

I tell investors that when creating a portfolio, they should diversify into various sectors, geographies, and market caps. There are times when large cap companies outperform and other times when small cap or microcap companies are better.

No doubt, my buddy was looking for one of those microcaps that are about to take off. Everybody is. And it’s okay to invest in these types of companies.

In fact, I recommend that investors include microcaps in their portfolios so they have exposure to these small companies that can double or triple in a short period of time in some cases and fly under the radar in others.

Just be sure you know why you’re buying a stock, and have an exit plan (like a stop) set up ahead of time. This ensures that you will sell if things change or grab profits when it’s time.

The post The Right Way to Own Small Cap Stocks appeared first on Wealthy Retirement.