/biz/ - Business & Finance

>>57012264
Woah that's actually comparable with bonds. What's the argument for it again?

>>57012282
Dividends get raised (if you’re buying the No brainer companies). Bonds have a locked in yield unless they are TIPS bonds but TBs have a teeny tiny yield

I like the sentiment. I'm a big fan, as it allows me to put money into companies already doing it, who also respect that I'm not the unFEd who can snap fingers to leave money in someone else's hands for days without return.
Greater fool theory is degradation of the public.

i think fondly about XOM every day

2.2%

Visual illustration of how big Costco's special dividends are compared to their normal quarterly dividend.

Look at this dividend growth

>>57013832

Nice.

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>>57012264
CEF NIGGAS WWA??

>>57012264
Anyone see the weird spikes Dow chemical has had over the last two months? Can't tell if low volume or massive buy orders. Regardless its clear some institution are purchasing a fair amount of it.

>>57015456
26054MED9
26054MEC1
26054MEB3
Three bond offerings this month ranging from 4.9% to 5.8%

Time to BTFO this general once again:

Dividends are irrelevant:
>https://www.jstor.org/stable/2351143
Above is the original paper, and below is a summary that is likely more your speed:
>https://www.investopedia.com/terms/d/dividendirrelevance.asp
Here's a good video explaining the concept as well:
>https://www.youtube.com/watch?v=f5j9v9dfinQ

Rather than relying on something irrelevant like dividends, if you really must use some generic factor criteria to drive longterm investment decisions. I'd recommend you consider the Fama-French 5 factor model:
>https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2287202

Once adjusting for other factors, dividends become entirely irrelevant as a predictor of future stock returns:
>https://www.financialplanningassociation.org/article/journal/APR13-dividend-investing-value-tilt-disguise
>In this study, the dividend yield factor has been shown to actually detract from portfolio performance.
And one final video, pointing out the drawbacks of restricting investment options based on some arbitrary irrelevant criteria:
>https://www.youtube.com/watch?v=4iNOtVtNKuU

Hope this helps you see the light.

>>57015945
the academic models assume a market with zero transaction costs, and also assume (relatedly) that the only thing you care about is total return, and are indifferent as to what proportion of the return is in cash and what is in capital gains. More assumptions that are reasonable in academia where cows are spherical and undergo perfectly elastic collisions, but which are false in the real world.

>>57015945
The “Dividends are Not Free Money” Fallacy

Yeah, no shit! This is the go-to line of the “dividends are irrelevant” crowd, as they play what they think is the trump card to end all arguments.

Except that it’s a strawman. Not a single person who has the slightest knowledge about how finance works is ever under the delusion that dividends grow on trees. It’s kind of obvious that dividends come from a company’s assets, right? Or did they believe that those who want dividends think the money “magically” appears out of nowhere?

Retaining and Paying a Dividend are NOT Equivalent

Even though dividends are not “free money”, the choice to receive and re-invest dividends is not the same as the company retaining 100% of its earnings. This is the most prevalent myth perpetrated – unknowingly – by those who claim that dividends are irrelevant.

Those arguing against the relevance of dividends provide the following argument. Let’s say a company’s stock is worth $10. In scenario A, it provides a $1 dividend. In scenario B, it retains its earnings. According to them, the two scenarios are equivalent because of the following math:

Scenario A – with a dividend
Total value = Dividend + (Stock Price – Dividend)

= $1 + ($10-$1) = $10

Scenario B – without a dividend

Total value = Stock price = $10

In other words, the total return is the same because the value of your stock drops by $1 after issuing the dividend (which is paid from the company’s assets). So according to them, this is like transferring money from one pocket to the other. Ben Felix – who has become famous, thanks to his well-known Youtube video on the “Irrelevance of Dividends”

>>57015945
Relevance depends on the goal. Your critique of dividend investing is irrelevant.
Once again you argue from a dishonest premise that dividend investors primarily focus on yield. That is of course a risk that should be addressed, hence why we have thread discussing the subject. I think most would agree that a balanced portfolio of high, mid and low yield with high dividend growth. With a healthy mix of blue ship and growing innovative companies that will stay relevant in the future.

>>57015945
Dividends are Like Moving Money from One Pocket to the Other?
But Ben Felix and others who repeat the above sentiment are wrong. While the math for the immediate stock price + dividend is the same because the dividends come out of the stock price, the difference behind the scenes is very large.

Re-Invested Dividends Buy Proven, Existing Cashflows

When you use your dividends to purchase additional shares in a company, you are purchasing more of the same, proven cashflow that the company has already demonstrated it can pull off. There’s no speculation. Mind, I’m not saying that dividends are guaranteed and that the company won’t cut them in the future. But the company has shown that it can generate the cashflow it already has, and you are using your dividends to buy more of the same.

In other words, you are using your dividends to purchase another tap, compared to retained earnings, where the company only promises to grow the size of the existing tap.
Each time you re-invest your dividends, you are purchasing another tap that already exists.

When a company retains its earnings, it’s making the following promise to you:

I will invest this money into the company to generate at least the same returns as the one I’m generating now, if not more. These earnings will be in addition to my existing operations.

The last part is important. The company is promising to grow its business at an Internal Rate of Return (IRR) that is at least the same as what it is currently generating. That growth hasn’t happened yet. It is a speculation. It may never happen. There’s a good chance that the company will fail to generate higher returns on its retained earnings than what it is currently generating.
In general, I don’t believe that magical, revenue-growing opportunities are just randomly lying around in which companies can easily invest their retained earnings at a higher IRR than their already existing cashflow machine

>>57015945
Tobins q is empirically correlated with future growth and stock buybacks mathematically offset tobins q

>>57012264
>400k in SCHD
>contemplated going all in in COIN and NVDA in december 2022
>chickened out

now I have 400k in SCHD instead of 1.2million in NVDA and COIN

I want to kms

>>57016972
This probably didn’t happen. Especially since he didn’t post his $400k SCHD position

>>57016867
>>57016876
Based dividend irrelevance BTFOer

why does Fidelity show my estimated annual dividends from my 30 shares of HDV as 0?

Yeah

>>57012264
Anyone buying NEP?

>>57016867
>>57016876
based

>>57015945
>The story of the goose that laid golden eggs illustrates the negative consequences of greed. Although the farmer was able to take a golden egg from the nest each morning, he became greedy over time. Instead of being satisfied with what was already a very happy situation, he demands ever greater and faster wealth.

Blessed divi threads. What is your divi split guys? Do you put everything into SCHD? Or do you build your own diversified portfolio? How many different stocks do you want in it? And have you thought about payment stucture?
My goal is for dividends to replace my income withing 10 to fifteen years. To keep safe I want my portfolio to have 30 stocks each paying out 3.33% of my total divi payments. This is a long term goal. My first goal is to have an actual divi payment of €100 per month. My total payment per year is now €1300 but most of it is payed in june and december. I have a crypto portfolio worth about 60k (€) and I will be selling all of it after we get a nice bull run 2024/2025 and putting it all in divi stocks.
tldr; what is your strategy?

i get dividends from my SPY and VOO. does that count as dividend investing?

>>57016867
It reads like chatGPT slop

Keep being told to buy accumulating stocks while still (fairly) young and move them to dividend paying stocks when I am older.
Yay or nay?

>>57021575
This is my recurring Roth buy every 2 weeks.

>>57022199
This is mine

>>57021575
>To keep safe I want my portfolio to have 30 stocks each paying out 3.33% of my total divi payments.
Not all companies are equal, imo there will be a few you ideally want to be heavier in, like 5-10 great companies and then spread out risk on the remaining positions.

>>57021777
I'd at least have a small dividend portfolio you add money to and reinvest dividends.

>>57022313
We have very similar taste in companies

>>57015945

>Hey, buy my company
>No, I'm not paying you
>Yeah it's better if you just let me hold on to all the profits
>I swear I'm financially accountable
>Here, check out all these records I provided without verification

If you own a company that doesn't pay you then you're just a financial cuck.

>>57023011
This is a fact

>>57021575
I'm aiming for a narrower spread of 10-15 companies, mostly in commodities. I wouldn't want to spread much wider than that, if i'm investing in something I want to be able to put the time in to understand its performance and potential.
Not really worried about when the payouts are during the year, although an even spread is usually nicer

>>57021575

I have about 10 companies. My top earners are IIPR, NLCP, O, EPD, and RIO.

NLCP has legit growth potential, and RIO just randomly writes huge checks to investors every few years.

My realty income boosted my Roth past $10k last week. I loaded up in the high $40s so it now constitutes 70% of my entire portfolio. I’m going to let it ride on DRIP but I only a lot $5 per contribution to O seen here >>57022199