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Long-termLong Term Microsoft Stock Investment: The Pros and ConsMicrosoft Corporation (MSFT) is one of the most successful companies on the planet, with a market capitalization rate of about $2.25 trillion. The stock is as impressive as the organization, trading at an all-time high of around $300 and maintaining a quarterly dividend of $0.62 a share. Microsoft is certainly a top-notch security and of the few growth stocks to have in your portfolio that can offer solid long-term capital gains and a regular income. That said, like any other investment on the New York Stock Exchange, Microsoft does have its own set of pros and cons. What are they? Let's explore! Pros of Investing in Microsoft Long-Term Microsoft Has Great Value The primary supporting factor in owning the technology juggernaut is its valuation. It is only one of two businesses to possess a $2 trillion-plus market cap (the other being Apple). When a company is this immense, it is challenging to bet against it. To put its stock's success into context, if you had $1,000 and you were investing in Microsoft in 2011, it would be worth $12,000 today! Maintain a Steady Corporate Leadership The corporate leadership has been steady, with only three chief executive officers since Microsoft was founded in 1975, with Bill Gates serving in this position for 25 years. Although it is widely considered that the Steve Ballmer years were the dark days of Microsoft, Satya Nadella has been doing a remarkable job as his tenure has seen the tech titan outperforming Wall Street expectations because of its move into cloud computing and Software as a Service (SaaS) and its improvements in the operating systems (many shudder at the idea of Vista!). They Secure Lucrative Contracts Microsoft's contracts with the government have been lucrative. The most recent agreement was a $10 billion cloud contract with the Pentagon, choosing Microsoft software over Amazon and its Amazon Web Services (AWS). It would make sense, too, since Microsoft and Johnson & Johnson are considered lower default risks than the United States government! This explains why shares keep rising. Microsoft Is the King of Dividends One of the best methods of determining a corporation's success is by studying its dividend. Microsoft has been a dividend king for years, routinely increasing its quarterly payments, even during the coronavirus pandemic when it gave it a nickel boost, from $0.51 to $0.56. Cons of Investing in Microsoft Long-Term Is Microsoft overvalued? This is one of the chief questions that new investors are asking before they pick up shares of the company. Stagnating Price-Earnings Ratio By looking at the price-earnings ratio (P/E ratio), it has stagnated this year, trending in the 37 range, which is way down from the peak of 60 at the start of 2018. Still, investors do see some growth, but not as much as in previous years. The price-earnings growth ratio (PEG ratio) is 2.25 These readings are higher than the S&P 500. On the surface, this is great. But once you scratch beneath the surface, you start to wonder if a two-trillion-dollar firm can maintain growth at a quick enough rate to justify these measurements. Rising Technology Competition Another risk that is minuscule but still something to watch out for is competition. If a competing tech giant makes tremendous strides in quantum computing, artificial intelligence, or cloud engineering, Microsoft could lose out on market share. Conclusion: Is Microsoft a Good Long-Term Stock to Buy in 2021? Investing in equities, no matter what it is, will always involve a risk vs reward element. Despite Microsoft's meteoric ascent over the last year, there is plenty of uncertainty regarding the future of the stock. From volatility in the broader financial markets to equities like Microsoft being able to sustain the momentum, many traders - seasoned and novice - would stand back and be wary of buying shares in a stock that is trading way above all-time highs. Will Microsoft always be a cash cow? If you are buying the company strictly on dividends, you will have found the golden chalice by holding long-term. However, if you are seeking capital gains with a short-term investment strategy, adding Microsoft might not be a wise decision for your portfolio.
Long-termThe Best Appreciating Assets to Invest InPeople with a steady income should take a look into investing in long-term assets, as that course of action may assist you in securing a stable financial future. One safe strategy to steadily increase your worth is to invest in various appreciating assets that can significantly increase in value over time. Naturally, there is no assurance that any investment you buy will drastically rise in the future. However, some appreciating assets have a decent possibility of assisting you in accumulating wealth. How to Invest in Appreciating Assets As appreciating assets slowly build wealth and not quick temporary riches, it might require serious research, time, and effort to choose the right ones. Investing in assets is a great way to develop long-term wealth rather than simply immediate gain. Doing this will be a vital component of your goals if you want to take your finances to the next level. There are several assets that you could consider investing in and some that you should avoid. What you invest in is a personal decision and dependent on your financial objectives. The following is a list of the best long-term appreciating assets to consider: Real estate / real estate trust fundsDividend stocksA reliable savings accountsCommoditiesCollectibles However, you would do well to remember that there are some assets you should avoid buying. These are the so-called "toxic investments" with unpredictable volatility that are best kept away from. Subprime mortgagesPenny stocksHigh-yield bonds Conclusion It goes without saying that all of these investments come with an inherent risk, as there is always the possibility of losing money if things don’t work out. Even so, remember that investing is a long-term goal. It’s not about choosing the most popular and publicized assets on the market, but rather the ones that you believe will be the best in the future.
Long-termIs Churchill Capital (CCIV) Good For Long-Term Investment?Churchill Capital IV (CCIV) has taken Lucid Motors (LUCIDM) public, which means that CCIV's investors can take a stake in one of the most interesting EV players that has a very ambitious growth plan over the coming years. The CCIV stock potential is pretty lucrative right now, particularly as it is way below the 52-week high. With President Biden's infrastructure plan that will encourage EV adoption, the initiative lacked details, creating more uncertainty and testing investors' patience. That mayhem has created buying opportunities for long-term investors, particularly for the relatively more mature EV start-ups with the greatest potential. This has ignited a CCIV stock discussion. What The Future Is Holding For Churchill Capital Big EV market names know that it takes years to go from concept to commercial success when developing a vehicle. Still, the actual fundamentals around Lucid haven't changed dramatically over the past year, yet, the share price has experienced wild volatility. Now can still be a decent entry point at around $20. This recent volatility can only be explained by sentiment and emotional trading, given that Lucid Motor's actual business outlook hasn't meaningfully shifted. Looking at Lucid Motor's plans, they have strong designs, great tech, and have a lot of potential in the EV space as its Air model will likely face strong demand in the luxury criteria. However, even though the company is highly valued, it has not sold a single EV yet, and there are no guarantees for success. A Look at the CCIV Options Movement In recent sessions, there has been some unusual movement in CCIV options. This sent prices plummeting by more than 3%. What does this mean? There could be a couple of explanations involving CCIV futures. First, the volume of contracts is higher than normal, especially for a stock that has been trading publicly for less than a year. Second, contracts are being traded with an expiration date months ahead, which should be noted since there is a split between the strike price and asset valuation. After observing the CCIV options activity, the sentiment remains bullish (a call is bought at or near the asking price). Investment Strategies with CCIV Options Now, are there any investment strategies with CCIV options? It should be noted that there are only a couple of internal catalysts that could drive the stock moving forward. The first is that a class action complaint had been filed on behalf of CCIV shareholders, accusing the company of violating federal securities laws. The class period was between January 11, 2021, and February 22, 2021, with the lead plaintiff deadline scheduled for August 30, 2021. The second is that Lucid Motors and Churchill Capital IV will officially complete the merger on July 23, 2021. While this is an administrative process, it does close the book on the specifics. For now, bullish investors are desiring the 21-day moving average to persist for CCIV shares to garner enough support. Is a 50-day moving average next? Is CCIV Stock a Good Buy? With all the information above, does this mean that CCIV is a good long-term investment? How high will CCIV stock go? Perhaps once the EV market bubble has subsided, the industry, as well as CCIV, will be on a permanent upward trajectory. The company has a great product coming out and is well-positioned from a technological perspective. It would be a good idea if management can deliver on its growth goals, and the shares are way cheaper than those of Tesla. Takeaway In the end, for a company that hasn't sold a single EV, it's too soon to say. Many industry observers are waiting for deliveries. It can still be considered a safe choice to invest a minor part of your portfolio with a strong return outlook in the long run. Ultimately, CCIV's offerings will be shares to hold for the long term.
Long-termHow to Identify Good Long-Term ETFs to Invest InWhile ETFs are a safe choice for many investors and traders, there are almost too many options to choose from. To start choosing good long-term ETFs, you need to narrow down the selection. On US exchanges, there are over 2,000 listed ETFs on US exchanges, so it can be challenging to choose the right one. Identifying a long-term ETF When identifying a good long-term ETF, you should first look at its fund size. While it may not be universally true, large fund-size ETFs usually have higher liquidity and lower costs. Obviously, it would help if you look for an ETF with consistent growth, so ensure that you have enough historical data to back up your choice. Consider your age, risk factor, and budget Once you narrow down your selection a bit, you need to customize your investment plan on a couple of factors. Depending on your age, you need to adequately adjust your portfolio's volatility. If you're younger, you have the possibility of risking more, as you probably won't be saving for retirement soon. If you're younger and you ready to risk some of your savings, it's best if you focus on growth-oriented stocks. More precisely, you can make large-cap US stocks and ETFs the core of your investment portfolio. S&P 500 and IEMG are good choices for this group, as you can withstand the volatility. On the other hand, middle-aged investors should go with medium-risk options. There are some good long-term IT-oriented ETFs specifically for this, like iShares Global and VGT. This way, your portfolio is still relatively diverse but not as volatile as some growth-oriented ETFs. Investors entering retirement should look for a steady income source and low risk. A good dividend ETF, like the SCHD or VIG, is an excellent choice for a steady income stream. Conclusion While there's plenty of factors to consider when buying a good long-term ETF, fund size, historical data, and share price are usually enough for a decision.
Long-termHow to Build an Investment Portfolio for RetirementWe all dream of retirement - a time when we can put our feet up, and enjoy the fruits of our labor. However, retiring is not necessarily particularly straightforward from a financial perspective, so in this article, we will examine how to build an investment portfolio for your retirement. Retirement Basket An investment portfolio for retirement can be thought of as a basket that contains all of the investments you have made during your working career. This means that a diversified portfolio is ideal, as this will enable you to cover every base in the investment market. The most important principle to remember across your investment portfolio is that it needs to grow with you, rather than restricting you during retirement. Growth Stocks Central to any long-term investment portfolio should be growth stocks. These activities will likely increase in value over a period of time. Often these can be big, established companies, which will continue to grow and increase revenue, regardless of the market conditions. Employer-Backed Schemes Investing in employer-backed schemes is certainly advisable, and often these are required legally. This is an excellent opportunity to take advantage of your company's financial investments and benefit from a personal pension scheme or 401(k). Private Pensions Additionally, it is always worthwhile to sink any savings into private pensions as well. These can pay out both lump sums and regular income once a person reaches retirement. However, it is generally worthwhile to seek financial advice before committing to a particular pension scheme. Robo-Advisors Another option that definitely merits consideration in this day and age is to have an algorithmic trader involved with your portfolio. These highly sophisticated digital platforms allocate and manage funds for you, so you benefit from their artificial intelligence, without having to actively manage your money.