How To Make Passive Income Through Robinhood App By Dividend Investing

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Well good day subscribers hope you guys having a great day out there as always if you’re new here i am jeremy and today i’m gonna teach you guys exactly how to make passive income by dividend investing through the robin hood app in dividend investing is a magical magical thing it’s a way you can compound money so your money makes you more and more money so for instance

Maybe at first you only make in like 20 dollars a year from dividend stocks then you progress you compound some money next thing you’re making $40 then you’re making $100 then maybe you’re making $1,000 then eventually over time you make so much money in dividend money you really can’t even keep track of it okay so let’s get into this already guys the process i’m

About to share with you is actually much much simpler than a lot of people would even realize okay so make sure you smash the thumbs up button if you enjoy me sharing this with you and make sure you share this with a friend so they can start actually building some wealth compounding money and things like that because this is not the most complicated thing in the

World this is not the hardest thing to do in the world it’s actually i don’t want to say necessarily an easy thing to do but it is certainly not a hard thing to pull off okay so let’s start getting into this okay so first off why you should you go through the robin hood app specifically i think robin hood is really phenomenal because a lot of people that start in

The stock market and want to start building wealth start buying dividend stocks a lot of folks that are doing that are usually buying for hundreds of dollars at a time maybe they’re trying to invest their first thousand dollars in something like that and so the robin hood app allows you to place these trades make these moves started buying these stocks with no

Commission on it which is absolutely huge ok because most brokerage houses that if you want to go and buy a dividend stock they’re gonna usually charge you $4.95 commission for every buy order and sell order you place ok robin hood doesn’t charge you anything so basically every trade you get to place you get to save five dollars versus like a regular brokerage okay

Now i don’t use robin hood personally because i’ve been with the company that i’ve been using for over a decade now and they do phenomenal work for me so i don’t want to like switch over to robin hood however i cannot say anything bad about robin hood and if you’re investing smaller amounts of money it’s generally going to be the app you want to go with because

They don’t charge and that is that means the world when you’re just starting out you’re investing your first 100 bucks your first few hundred bucks your first thousand dollars those five dollar commissions king can you know heard your account in the short-term okay so that’s why we’re specifically talking about the robin hood app okay so what is the process you

Need to go through here okay the process starts with setting up a robin hood account because you can’t make passive income you can’t make any dividend investing money if you don’t have your robin hood account set up so first thing is you need to set up that account it’s pretty much like setting up any bank account you put in your information and whatnot you get

That up enrolling okay by the way i just want to say this video is not sponsored by robin hood i’ve had people you know that work way up at robin hood try to contact me about sponsorships i don’t do sponsorships i’m not interested in them so this video is not sponsored by them but it’s like we talked about it just makes the most sense to go through them if you’re

Investing smaller amounts of money unless you want to pay $5 commission’s for each trade you know generally robin hood apps gonna be the way to go okay so you set up your robin hood account then you need to find dividend-paying stocks okay so if you don’t know like all stocks in the stock market don’t pay dividends okay there’s a lot of stocks in the stock market

That i own even that don’t pay any dividends so basically you’re counting on that stock going up in value over time not paying you out dividends and when i’m talking about paying out dividends most companies that pay dividends they do it every three months okay so you need to find companies that pay dividends you know i have a ton of videos on my channel you know

Talking about different dividend stocks and there are a ton of other videos here on youtube where other people are talking about dividend stocks you can go to like yahoo finance you can search lists of like top you know yielding dividend stocks or just the top dividend stocks and the dow 30 and things like that okay many of the companies that are in the dow 30 which

Is like the 30 biggest companies in the s&p 500 which is like the 500 biggest stocks many of those companies pay dividends okay so finding companies that pay dividends is not a hard thing at all it’s actually really really easy to find out what these companies pay you can use something like yahoo finance type in a ticker symbol you want to look into apple stock

For instance right type in you know apples ticker is a apl take that into yahoo finance you’ll be able to see if it pays a dividend it’ll say right there i’m like that we don’t basically rate when you get on the page aapl it pays a 2% dividend yield or something like that so you’re gonna be able to find thirty of dividend stocks very easily on the internet okay

Then you need to start doing some research work okay now if you want to make passive income you generally always have to put in some upfront work okay you always usually have to do something at first so then it can generate you passive income so what we’re calling this now the research work this is your upfront work so you can potentially make you know passive

Income and this dividend money can roll in from months and months into the future if not years and years into the future okay so how are you gonna research these businesses in these stocks okay is basically what you want to look at you want to look at the 10k so there’s what’s called an investor relations page of every public company out there okay so let’s say you

Want to go ahead and look in a coca-cola stock you like that’s a stable stock you know that’s that’s a great company like people drink coca-cola and they drink the different products that coca-cola has right so you can go ahead and go into google type in coca-cola investor relations page it’ll be the first thing then you’re generally pops up you go ahead and click

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On that and all the information you could possibly want about coca-cola corporation is going to be right there on that investor relations page to look into this dividend stock okay so you’re gonna want to read through the annual report which is going to give you most of the information you could possibly ever want about the business model what they’re going after

What they’re doing what their progress has been over the past year you want to read over the ten q which is going to look at the last quarter versus a previous year’s quarter where the business is going what you know the challenges are what the things they’re doing successfully all those sorts of things you’re gonna win listen to the latest conference calls all this

Information is on the investor relations page of all public companies okay throughout reading this information or listening these conference calls you’re gonna go from not knowing very much about a business to having you know so much knowledge on a business like you were a high-level manager of that business or something like that almost within like a few hours time

Okay and you can you know read over these reports again so if you don’t catch everything the first report go ahead and read over it again because sometimes we lose concentration right you’re like you think you’re like watching something right but you’re actually thinking about something else so you’re not even retaining the information or you think you’re reading

A book but really you’re your mind is somewhere else and so you’re going throughout the pages but your mind is somewhere else you’re not retaining information so sometimes that’s going to happen if you read a 10k read a 10-q list in a conference call the trick is you want to go over it again and again until you retained all the information your mind is at a point

Where you fully understand that business model now once you fully research the business what the competitors are all those sorts of things now you’re going to start to be able to you know get a good understanding of what the business is gonna do over time okay and if you can see that business increasing so you got to ask yourself do you see the business meaning

The revenues the net incomes do you see that increasing in future years do you see that increasing your in future years and after you’ve gone through all these reports and the conference calls you should have a pretty good understanding like oh yeah i can see this business increasing their business their revenues their net incomes their profits in future years or

You know what i don’t think so i think this is a business that’s down training you should be able to formulate an idea after you’ve gone through all that information okay people wonder like how do you have such conviction on if a business model is going to increase in the future or decrease in the future the reason i generally know these things is because i’ve gone

Through all the reports i’ve read about them and so i’m understanding the business on a whole other level than like the average person would understand this business because you might hear coca-cola corporation you might just be like oh i know some of their products but i actually don’t know if their business is gonna increase it’s like you’d be you know guessing

If you’ve read all the reports on that company you you should be able to say with conviction yeah their business is gonna be increasing over the next five years no their business is not going to be increasing over the next five years because they have blah blah blah competitor because that business is declining because that sector is declining or whatever okay

That’s how you really understand a business on a high level and if they’re gonna be increasing okay know if you see the business decreasing in the future then that’s a no stock meaning it’s not worth investing in because you never want to be investing in businesses that are in decline that you can see like over the next five years their business is going to

Decline more if you don’t have faith that their business in their net income in their revenues and all those sorts of things are gonna increase in future years then it shouldn’t be a stock you’re investing because you’re trying to make a passive income dividend money from these stocks in future years you’re not trying to trade in and out of these stocks on time

You’re trying to buy a stock that you feel comfortable putting your money in for the next three five seven years okay so you’ve got to find businesses that you feel comfortable with investing in that you fully understand the biz how do you fully understand the business go through all those different reports and if you’ve gone through the 10-k 10-q conference calls

You’ve read time and time again i’ve gone through these reports three times i still understand them with that business does then that’s a no stock you don’t want to invest it never invest in anything anything you do not fully a hundred percent understand whether we’re talking stock market real estate where we’re talking you know you’re giving your money over to

Somebody so they can invest it for you if you don’t fully understand where your money’s going and what that company’s doing don’t invest in that stock okay you’ve got to fully understand it and you’ve got to see that business increasing in future years and if you’ve gone through all these important reports and you can’t give me a yes on both of those don’t invest

In okay but let’s say yes you see that business increasing over time you fully understand the business you like i know what they do man i know what they’re going after i know what their goals are over the future years great okay now we can go over here and we can look at their balance sheet this is very important so balance sheet think about a balance sheet in this

Respect okay imagine you you have a balance sheet you watching this video right now you have a personal balance sheet okay you might own a home okay this might be an asset for you unless you’re underwater in the home and you basically owe more on the home than what it’s worth okay but you might have a home so that is an asset for you right it goes under the asset

Category alright you might own a car okay now if you own that car you know straight up and you’re not underwater on that car then it’s a partial asset for you okay so let’s say your car is worth five thousand dollars and you don’t know any money on that your you’ve got a five thousand dollar asset there because you could sell it to you know today or tomorrow for

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Five thousand dollars and go ahead and take that money and do something else okay liabilities are like debt if you have a massive amount of credit card debt that’s a liability you have your own like balance sheet in your life right you have assets vs. liabilities saying the exact thing for companies they have assets vs. liabilities but specifically what interests

Me when it comes to a stock or a company i’m looking at how much cash they have which cash is a line item on a balance sheet how much cash do they have how much in investments do they have short term investments long term investments and i go ahead and add up those numbers and then i subtract how much debt they have and so i’m looking for companies that not only pay

Dividends have an increasing business model and i can fully understand that but also have more in cash and investments than they do debts okay now if they do have more in debt it can’t be like a substantial amount more or too risky at that point time if you’re talking about a debt leading company that has let’s say ten times more in debts than cash in investments

That’s a little risky because what happens if a recession happens what happens if that company’s business small is hurting a little bit less than in the short term remember we’re trying to make dividend investing money you know passive income money we don’t want to be having to trade in and out of these stocks all the time we want to be in investing in companies

That we feel comfortable in the next three five seven years if you’re investing in a company that has massive loads of debt hardly any cash or investments on that balance sheet you’re sticking yourself in a risky situation that’s what you’re going ahead and do and you’re sticking yourself in a very risky situation that if that company goes bad you’re gonna be stuck

In a real hard situation and maybe trying to trade in and now that stock which is not your goal your goal is to make passive income dividend money overall we don’t want to have to be worrying about getting in and out of these stocks when you’re trying to do something like this okay so make sure you’re finding companies that have great balance sheets loaded on cash

Loaded on investments and have as little debt as possible okay those are winning balance sheets all right so let’s say the balance sheets great we can move on in the next step by the way if the balance sheets garbage they have tons more in debt than they do cash investments that’s probably not worth it risk okay but let’s say it has a great balance sheet okay now we

Go the next step which is where i look at three different things in relation to the dividend okay first thing we’re a look at is the dividend yield which means how much money you get paid out based upon the current dividends the company pays okay so let’s say a stock is $100 a share okay let’s say the stocks a hundred dollars to share and they pay out two dollars a

Year in dividends well that means they have a two percent dividend yield because you go ahead and take a hundred divided by two we’re gonna get two percent okay so the companies basically you want to make two percent on your money based upon current dividends okay now don’t get too caught up in the current dividend yield because a lot of great companies especially if

They have increasing business great balance sheet they’re actually gonna up their dividend each and every year okay great companies that are very well run they’ll up their dividend so don’t get too caught up in all this stock pays a two percent dividend yield this one pays a four percent to the four percents better not necessarily because if the other business has

A great business that’s increasing great bouncy they’re probably going to increase their dividend massively over the next three years five years seven years in the passive income will really like you know you start pouring in because they’re just in a position of power versus some other company that have really high yields and see businesses declining those type

Of businesses are actually in a position of weakness okay next thing i don’t want to look at is what’s the dividend history for the stock so basically you can go to like yahoo finance or something go to historical data and go to dividends only and back it up the last like ten years and you’re gonna be able to look at the dividend history for whatever that stock is

Okay so let’s say you’re investing or you want to look into pepsi stock and you’re like oh this is a great business wall i can see it increasing i understand it good balance sheet okay i can invest in this company so you’re looking at a pepsi and you’re like well what’s the dividend history with the stocks you go on yahoo finance go to historical data go dividends

Only back it up for the last ten years and you’ll be able to see oh yeah this company is paying out dividends every three months in their increasing every single year those are the type of companies we really want to get involved with you’re talking about making passive income dividend income okay you want to find those type of companies that have great dividend

Tract histories not companies that just started paying dividends yesterday those are risky i mean how do you know they’re gonna keep that dividend they just started paying it or something like that okay you were companies that are proven that they can up those dividends each and every year okay and they pay them every single three months all right also you want

To look at the dividend payout ratio this basically means of the earnings per share how much are they already paying out in dividends so let’s say you have a stock and they pay out ten dollars per share in dividends per year right and they have eps a year of $100 per share okay that means they have a ten percent payout ratio which means they cut up that dividend

Massively in future years okay that would be an ideal situation okay let’s say there’s a company it has aps of $10 per share each year okay $10 eps and they pay out you know $2 in dividends that means they have a 20% payout ratio which is generally very low we’re really looking for payout ratios below 50% if it’s ideal okay ideal situation as payout ratios under 50%

Because that means they have a lot of wiggle room to up that dividend in future years if they just make as much money as they did last year nevermind if they increase that business now they could up that dividend even more okay which is a beautiful beautiful thing so dividend yield were looking at dividend tract record like the history of that stock paying dividends

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And the payout ratio okay very very important now everything looks good there we can move on to the next step which now you invest whatever you feel comfortable with okay so you found the stock you like okay everything everything’s checking out balance sheet the track record all those sorts of things business increasing i understand that i’m ready to invest this

Stock no you got to choose what’s your comfort level with investing okay so maybe you feel comfortable investing almost all your net worth in that one stock okay if that’s you you know do what you want to do okay but you’re generally gonna go i want to go with a disciplined approach okay so let’s say you got a thousand near your net worth a thousand dollars okay

You got a thousand dollars in a savings account and that’s you know what you have for money right now you might feel comfortable just investing a hundred dollars into it for now maybe two hundred dollars maybe five hundred dollars do whatever amount you feel comfortable with at that particular time don’t invest too much where yeah it’s at a point where you don’t

Have comfort you’re like you know can’t sleep at night because you’re worried about that money and what’s gonna happen because remember and the stock market stock prices move up and down all the time we’re not so worried about if we’re focusing on dividend investing right because we’re focus if your dividend investor your main focus is getting dividend money making

That passive income constantly and then reinvesting that into other dividend stocks so they can make you more money and more money and the money can compound in compound member we talked about the beginning of the video you like you know compounding and building that money and you’re receiving this much one year and then your to do receiving this much in next year

And you just keep building and building okay so we’re not so worried about stock prices but still you’re gonna see stock prices moving up and down all the time because this is a stock market there’s volatility you got to invest what you feel comfortable with and at the same time don’t invest too little where you’re not even thinking about okay let’s say you’ve

Got a net worth of $10,000 and you invest a hundred dollars into a stock that’s such a small amount of your net worth ii you might not even care if that stock goes up or down it might not affect you you want to invest enough where put you maybe slightly i was out of your comfort zone but not so much where you’re so worried about that money and losing that money

And what happens if the stock go down in blah blah blah you don’t want to put yourself in that position so you’re trying to find that happy medium where you’re a little out of your comfort zone but you’re not so much where you’re like freaking out every time the stock market goes up or down or something like that okay and the next step is you basically sit back

And you collect dividend money for future years you keep an eye on things you keep an eye on what’s going on with that stock no different than a real estate investor we keep an eye on the property and maybe walk the property once a year or something like or maybe they got a you don’t get a phone call and it’s like hey we need the sink fix the sink isn’t working

Or something like that okay there’s a little work you got to still do but for the most part you’re not worried about this stock every day not even worried about it every month maybe you keep track of what happens on the court or the reports every three months so every three month you listen to the conference call and you read the ten q and things like that okay

What’s that take a few hours time every three months we’re not talking about a lot of work you’re putting in this is much of just passive income you’re making this isn’t like having a job and you’re collecting this money you’re collecting this passive income these dividend stocks were thrown off and then you go ahead and you take that money and you invest in more

And you go through the same exact process again you find some more dividend stocks you look into them you research them you figure out the businesses are great if they’re increasing likely to increase you figure out the balance sheet the yield all those sorts of things you find the next stock and then you’ll start receiving more and more dividend money and then

You’ll invest that even to more stocks and you’ll start receiving even more dividend money and it’s just like a mountain that keeps building and building building as long as you do it successfully and you’re doing the research work the initial work so you can make that passive income in future years as long as you’re doing that initial work you should be able to

You know build a ridiculous fortune in a matter of 5 10 15 20 years into the future you’ve just got to do the upfront research work so that passive income can just kind of plow in and then you just kind of maintain things every three months you look at the reports how’s that a company doing is everything still going according as plan you know if your dividend

Investing you shouldn’t be worrying about the stock price too much it’s more like hey what’s going on with the business overall what’s with the fundamentals is everything still playing out the way i thought it would play out and if it is great you should make a lot of dividend money and build and build a building in the future and that’s how you make a lot of passive

Income money through dividend investing and you can use the robin hood app for something like that you can use other brokerages to do it as well it’s just robin hood’s free to do four trades in that $5 it’s gonna save you each and every time especially if you’re investing smaller amounts of money guys so make sure you hit a thumbs up if you’re enjoying me sharing

This i give a lot of detail here about how to research a dividend stock and things like that so i hope you guys really appreciate it make sure you share this out with a friend or family member who wants to start building wealth for themselves alright thank you for watching have a great day you

Transcribed from video
How To Make Passive Income Through Robinhood App By Dividend Investing By Financial Education

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