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Author: draknor One star, 50 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76421  
Subject: Re: Best stocks for an IRA? Date: 7/26/2007 10:50 AM
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You may need to temper your desire for "high yield dividends", unless you are willing to take extraordinary risk / volatility. Most blue-chip companies are in the 2-3% yield range right now. Some of the banks are in the 4-5% range. The only stock category that seems to be in the 7-8% range is REITs, and real estate is a volatile environment right now, coming off a bubble with subprime lendng practices putting downward pressure on both real estate & banks.

The advice you'll see most often around here is:

1. What are your goals? (ie match the S&P 500? Beat it by x%?)
2. What kind of investment strategy do you want to follow (buy 'n hold, trading / "market timing", etc)?
3. What's your time frame (20+ years?)
4. What kind of volatility can you really handle? Everyone says "oh, I can handle risk if it means more reward!", without realizing that "risk" often means "volatility", and that most people really can't handle seeing an investment drop 20-40% and not reach for the "sell!" button.

Search around the investment boards here -- there's a lot of good boards & discussions about different investing styles, areas to invest, etc. Two I recommend are the REIT board (if you really want those higher yields), and The BMW Method (board that discusses a method to find stocks that are at historically low valuations; this is mostly going to be blue-chip, large cap companies with long histories).
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