1Lun·

Pure motivation

🚀 Motivation $ISPA (+0,2 %) pure: Dividend ETFs are like a money tree in your portfolio 🌳💸 - you plant it once and it produces cash flow year after year. Regardless of whether prices fluctuate or the market causes drama: the dividend rings reliably in your account.

It's like swimming training:

It feels tough at first, length after length, day after day. But you get stronger with every stroke.

04.09

Xtrackers Stoxx Global Sel Div 100 Swap ETF

Recibío x40,88 dividendos por valor de 0,393 €

16,08 €

22 Comentarios

Eselai@DonkeyInvestor

1Lun

However, a look at the chart is rather demotivating

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finanzperpetuum@finanzperpetuum

1Lun

@DonkeyInvestor Annualized return / Cumulative return .... 9.14% vs 302.85% since inception 2009. Source ishares.com Considerable for a boring ETF I would say.

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Epi@Epi

1Lun

I will probably never understand the psychology of why a forced profit distribution should be more motivating than clean capital growth.

When my overall portfolio has achieved its target return of 1.5%pM, I'm happy. That motivates me. 🤷

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Yieldrology@Yield-Ahead

1Lun

@Epi That's good for you. As different as people are, so different are the Quinnies.

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Epi@Epi

1Lun

@Yield-Ahead Nothing against diversity, it's interesting and necessary for the markets. Nevertheless, I would like to understand the other side.

I would like to understand to what extent it can motivate me if a certain amount of my capital is regularly withdrawn from the stock and transferred back to me.
It is analogous to the case where I live in a house and every month someone comes, takes a brick from the house and gives it to me (and takes taxes for it). Is that a gift, a passive income, a motivation? 🤔

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Yieldrology@Yield-Ahead

1Lun

There is no comparison: A house is a static structure - if you remove bricks, it inevitably becomes smaller and more unstable. Corporate profits are dynamic, variable variables. They can and should grow. I benefit when these profits increase sustainably and are distributed as dividends that grow over the long term. That is highly motivating and attractive for me and others.

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Epi@Epi

1Lun

@Yield-Ahead Sure, you can compare the two. The statics of the house correspond to the profit growth of the dividend-paying companies.
Any removal of capital from a company in the form of dividends prevents this capital from being used to invest in future profit growth, thus making the house more unstable.

If it is convenient, a different picture: dividend payments literally bleed companies dry. Sometimes companies manage to survive and grow despite this bloodletting. Just as in the Middle Ages, sick children grew despite a high blood loss during bloodletting. But that was never helpful. And enjoying the fact that the companies to which I entrust my capital carry a heavy burden through me would make me feel guilty rather than motivated.

Do you understand my comprehension problem now?

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Yieldrology@Yield-Ahead

1Lun

No, I don't understand. I've been around GQ for a few years now. I mean you've discussed Divi cons vs pros (passionately) several times. Everything may have already been said, just not by everyone. Since I don't know you, I don't want to imply anything. But perhaps it's not a question of being able to understand, but a question of wanting to understand. Generations of dividend and income investors are not stupid and know what they are doing and why they are doing it. Thousands of companies also know exactly why they pay out their profits instead of not. Like I said. I don't want to insinuate anything. That's not my place.

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Epi@Epi

1Lun

@Yield-Ahead You're right, the discussion pro versus con dividends has been held many times.
However, and I think this is a pity, the pro-divs usually break off the discussions before they have explained their position. Usually, they first present the psychological effect of their position, then their position when asked - but never the explanation of their position. How am I supposed to understand anything?

And the reference to all the people and companies that rely on distributions unfortunately explains nothing. Because their behavior is exactly what I don't understand.

To be more specific: The investment legend Buffett himself deliberately refrains from distributions at his $BRK.B because he sees them as detrimental to investors. So does Buffett have no idea or what would you accuse him of?

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Yieldrology@Yield-Ahead

1Lun

@Epi With your analytical and logical approach, you will most likely not come to the desired conclusion. By the way, the dividend king Coca Cola is a significant position in the Berkshire portfolio, but let's not go there... 😀

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Epi@Epi

1Lun

@Yield-Ahead Too bad.
Then I'll just keep waiting for a prodiv who is prepared to explain dividend investing to me in an analytical and logical way.
Thanks anyway!

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Novius@Novius

1Lun

@Epi @Yield-Ahead Interesting discussion. I myself understand both positions, but have since switched to the dividend camp. Why? Because I would like to generate a passive source of money in about 8-10 years without (if possible) selling the securities myself. I would then like to leave them to the next generation. That is my (simple) motivation, perhaps not the best choice economically, but for me the most convincing 😉

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Yieldrology@Yield-Ahead

1Lun

@Novius That is also a good and understandable reason.

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Ver todas las 6 respuestas adicionales

Global I.@gloinvest

1Lun

Until you realize that there was no water in the pool. CAGR over the last 20 years: 5.9%. Pathetic.

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Jose@Kspykee

1Lun

Yo he optado por ETF de acumulación por tema impositivo. Me gusta recibir X€ cada poco tiempo, pero no pagarlo después al declarar Hacienda.

El ETF de acumulación sigue misma pauta, crece un poco más que el otro, y al vender, se obtiene lo mismo o un poco más.

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Johannes🦅🔥@Johannes001

1Lun

At the same time, dividends are also bad if you want to build up money, which many people want. Accumulating ETFs reinvest the dividends immediately. Without taxes being deducted. This is not the case with distributing ETFs

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