1Yr
Very good article and certainly contains a lot of correct and important information. Nevertheless, I would like to point out again that there is unfortunately no such thing as one and the same company with and without a dividend payment. With your point of view, you always have to ask yourself whether I don't buy a company because of the dividend. And that would not be good advice in many cases. A certain dividend continuity coupled with some other characteristics are sometimes indicators of the high quality of a company. One can also ask oneself whether I would not rather run a Microsoft despite dividends instead of a comparable peer without dividends, which then turns out to be a pipe-cracker. Of course, this question only applies to individual stocks and not to ETFs.
•
55
•
@erT i once had a paragraph inside that rephrased the question of "25 years of dividends increased" to "25 years of profits increased." In the vast majority of cases, the second includes the first. But it also widens the circle. Berkshire and Amazon, for example, would also be included. The quality feature is not the dividend, it is only a consequence, namely of the constantly increasing profit. In the end, I did not include the passage, however, because there would be a lot of additional work and research to be done to support the thesis. I didn't want to include the statement without being able to respond to related criticism 😉
••
1Yr
@Fabzy You are very honored that you only post with sufficient research. Ultimately, it is the case that almost all companies that report steadily rising profits also pay dividends at some point. Exceptions are e.g. Berkshire, which buys back shares for this purpose, which is admittedly also certainly more sensible from a tax point of view. I agree that dividends alone are not sufficient as a characteristic. But there is always an argument about which strategy and which type of stock outperforms which. I think the dividend is a good tool for motivation. That in turn leads to possibly investing more in the end. Not entirely rational, but IdR I think true.
•
22
•@erT If investing were so simple, we would all have the same portfolio. There are also reasons why such a topic fills entire doctoral theses and Nobel Prize articles. Everyone as he feels comfortable 🚀
••
1Yr
@Fabzy that's how it is. Especially since a securities account often reflects only part of the finances. And the rest of the background also differs. For my part, I have a mixture of different types and also different strategies in my portfolios. These in turn have to fit my family and the rest of my situation. My 15 years younger self invested differently than the current one.
••