Dividend investing for retirement Message Board

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Strategies & Market Trends : Dividend investing for retirement

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From: E_K_S	7/14/2011 10:27:10 AM
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Not sure if I agree with the conclusion of this article as it fails to mention the Buy & Hold strategy with respect to current & future company valuation. I like to evaluate my dividend return based on the company's PE and future PE as this reflects the price you pay for the stream of dividend income. There is always an alternative dividend payer with a lower PE that can be bought when the current position becomes over valued (ie PE reaches a historical high). Dividend Investing Is The New Buy And Hold businessinsider.com From the article:"...Today’s financial experts recommend holding for no longer than five years. Dividend Investing will become much more popular over the next few years as government debt hampers the growth of GDP in many developed countries...including the U.S. Remaining flexible in the market helps minimize losses and potentially gain more revenue from your holdings. Selling off your dividend stocks after five years just because the strategy says so only leads to more market instability. It may also lead to a loss if the stock price doesn’t appreciate. That isn’t to say dividend investing is the wrong strategy. It’s perfect for today’s market when applied appropriately. In fact, the abysmal returns of the last few years have brought down buy and hold earnings so much that Dividend Investing is yielding better returns. Over the last 100 years, dividends have provided as much as 90% of overall stock returns. Dividends have steadily paid out larger sums than other investment tools, such as bonds or money markets, without as much risk as traditional stock trading investments...." ------------------------------------------------------------------------------------------------------------------------- EKS

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