I normally like to have around $20 000-40 000 invested on the margin (money borrowed from my broker), which I can get at a really low interest rate (1.62% for the first $100 000 with Interactive Brokers) and then invested in dividend paying stocks that pay 3-5%, which leaves me with a nice profit of around 1-3% (after taxes) on that money. Except lately the markets have been going up and up and I’ve been just collecting dividend payments and adding more money to my brokerage account from my day-job so that I was down to around only $5000 on the margin. Not having “debt” isn’t really such a terrible thing so it didn’t worry me too much, but I’ve definitely been keeping my eyes open for a bargain or two.
Energy stocks such as ConocoPhillips (-4.16%) and Chevron (-3.67%) had a huge drop in the past day due to lowering oil prices. These are massive companies which can surely weather a few stormy months (or even years) of low oil prices and the drop in stock prices has absolutely nothing to do with any sort of weakness within the companies themselves, which is why I’m a buy. I just added 50 shares of Conoco Phillips to my previous position of 50 shares and am looking at adding more BP, Chevron and Exxon Mobil to my portfolio should prices drop further.