The has been above 8,000 points for about a month now. Are the days of cheap shares over? Well, in the past 10 years, the index has risen just 23% — with about half of that in 2024 alone! Dividends would add a bit. But it still looks like a poor 10-year ride compared to long-term average of about 6.
9% per year. Nearly double That should compound to a 95% rise every decade. And it suggests shares are still relatively cheap, even after this year’s gains.
I’ve made no use of the new Stocks and Shares so far. But that’s only because I haven’t had the cash yet. When I do, I’ll be buying as many cheap shares as I can.
Dividend yields are still high, so that’s my starting point. And I might pick my first buy from a cyclical sector that I think has fallen below the radar. Cyclical dividends Not long ago, mining stocks like ( ) had very big yields, and everyone wanted them.
Then the sector turned down as world inflation soared and Chinese demand slowed. But cycles like that are common. And commodity prices can vary a lot.
How can the long-term demand for copper, iron, and all the rest of the earth’s goodies not be strong? Nobody will be building much without them. Forecast value Today, we have a forecast dividend yield of 5.9%, and a forward price-to-earnings (P/E) ratio of 10.
3. Commodities prices are still a bit weak. Iron ore, for example, is way down on peak 2021 prices.
And that’s the main risk. Rio and similar companies have no control over world prices, and ca.
