Those who would like a nest egg stashed away for their later years will often seek retirement stocks, stocks with a good margin of safety as well as intrinsic stock value. Retirement stocks often pay dividends as well. The point is to have a steady income from ones portfolio while individual stocks still appreciate in value over the years.
There is a conservative, buy and hold investing aspect to retirement stocks that requires a balanced stock portfolio. It also requires that investors still pay attention to what they have in their portfolio with both fundamental and stock technical analysis. The point of retirement stocks is that the well-chosen ones are profitable and don’t necessarily require minute by minute attention by the retiree who would like to devote more time and effort to learning how to sail, garden, improve his tennis backhand, or familiarize himself with the art galleries of the world.
Nevertheless, the world of stocks has the tendency to change, which is what keeps making profits for traders using Candlestick analysis as a guide. Even with well-chosen retirement stocks such as consumer stocks stalwarts like Proctor & Gamble, Coca Cola, or Clorox, a little attention to the market using Candlestick patterns allows prospective retirees to pick stocks that are currently under priced and helps retirees rid their portfolios of stocks that are ready to fall in value.
The point of balancing a portfolio of retirement stocks is that economic conditions can drive stocks in different directions. During a recession consumer stocks often go up in price while growth stocks may falter. During a recovery growth stocks may take off again while consumer stocks will settle back into their usual routine.
When oil stocks and oil futures go up in price, industrial stocks and transportation stocks often suffer, and vice versa. By diversifying a stock portfolio a retiree spreads his investment risk over several stocks in several market sectors. A valid concern in picking stocks is just how many stocks to choose. A wider range of well-chosen stocks helps diversify investment risk. By picking too many stocks the prospective retiree needs to devote time to following his stocks when he may prefer to take his wife out to lunch or stroll along the beach. He may also dilute the profits that he could have achieved from successfully investing in start-ups.
Although a portfolio of retirement stocks will often be mostly large cap stocks, adding a couple of stocks with the potential for substantial growth may be a good idea, providing that the investor takes a close look at Candlestick chart formations to make sure that his choices are not ready for a market correction just as he buys the stocks.
When choosing stocks entry price is always important. Many good stocks for the long run have already been discounted by the market. The time to buy these stocks is when they are at their lowest price. This may be during a general market reversal or may have to do with the individual stock itself. Smart investors looking towards retirement pick strong stocks based upon fundamentals and then buy stocks based on technical analysis with Candlestick stock charts.
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