How to realize an ideal mix of investments in the present uncertain environment

In today’s Juice, we keep it simple. 

Because, with so much politics in the air (!), it can be easy to get emotional. Particularly with your investing. Talk about who’s supporting who and who wants to tax who. It’s all noise. At least if you’re a middle or upper middle class long-term stock market investor. 

Through it all — through all of the noise — the stock continues to move higher — in pretty much a straight line — over time. And we think this will continue to be the case. 

So, The Juice wants you to resist the urge to do anything other than stay the course and, maybe even, be more (appropriately) aggressive. The course being a strategy of regular, long-term investments into three categories: 

• The broad stock market via the SPDR S&P 500 ETF (SPY) and the Invesco QQQ ETF (QQQ). 

In September of 2023, The Juice asked: Is SPY And QQQ (And Maybe Love) All You Need?

Since then—

Not too shabby. 

• An assortment of Magnificent 7; high-growth tech and, specifically semiconductor stocks; and early inning, growth stories either directly or via low-cost ETFs. Among our favorites, here’s how things have looked over the last year. 

An important note to keep in mind for a minute: All of these stocks are on either side flat over the last month. 

• A select assortment of different types of dividend stocks. Among our favorites.

While these numbers are all approximate, they give you a solid idea of what we’re dealing with. And that’s one hell of a strong stock market with opportunities galore to diversify at nearly every level of risk, not to mention buy on the tip on days when — for example — tech suffers. 

These dividend stocks fall into several categories, each of which deserve representation in a long-term investors portfolio, alongside the previous two elements of this three-pronged strategy. So, even within the dividend category, you can diversify from relatively aggressive to somewhat conservative. 

GLW is an AI growth stock with a solid dividend. MSFT pays a solid dividend alongside its leadership role in AI. 

PG is an old school dividend aristocrat with a mammoth dividend increase streak of 69 years. 

HD and LOW are two (somewhat, though not horribly lagging) opportunities in housing with fantastic dividends that, as we explained last week when we added them to our buy list, have tons of room to run: 

We think this is an excellent time to buy both of these stocks. And to keep buying, specifically if you’re a long-term investor. Because — over the long haul — they’re going up. And we don’t think you’ll even have to wait very long. 

Home Depot and Lowe’s are likely going to be 2025 stories …

As the housing crisis intensifies, it will actually be good news for Home Depot and Lowe’s. The people who waited to sell will end up making improvements in their new home. Because they’ll need someplace to live and might be accommodating a growing family. The people who waited to buy — likewise. 

We generally don’t like weak stocks with good dividends. This is an exception. Because HD and LOW have merely taken breathers. So this is a good opportunity to buy the stocks cheap and enjoy the dividend income (reinvest it!) while you wait.

And, let’s face it, to call HD and LOW “weak” is a bit of a stretch. But that’s just indicative of the market we’re investing in. A very strong one with stellar gains — and solid dividends — everywhere. 

Throw a young payer such as Meta Platforms (META) and a handful of other dividend aristocrats into the mix and we’ll put our basket of dividend stocks up against any dividend ETF out there. 

Anyhow, the keeping-it-simple strategy. Here’s one illustration. 

When you see PG outperforming MSFT over the last month, you don’t favor one or the other. You buy both with a smile. MSFT on any weakness and PG on strength, collecting both dividends along the way. But, even simpler, you don’t buy based on weakness or strength. You don’t change a thing. You know why you’re in each stock to begin with and, with a long-term strategy, you buy on that conviction, not the story, controversy or attendant move of the day. 

The Bottom Line: We really feel like kids in a well-stocked candy store right now. AI stocks. Tech stocks, which, for all intents and purposes, are mostly AI stories right now. Story stocks like DASH and UBER. And dividend payers in the early innings of coming back into favor as investors anticipate rate cuts. 

The beauty of the environment we’re in is that we can actually be incredibly selective by doubling down on the strongest and most promising names in all of the categories where we love to put our money and watch it grow.

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