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Strategies & Market Trends : Dividend investing for retirement -- Ignore unavailable to you. Want to Upgrade?

To: chowder who wrote (6373)	11/12/2010 2:50:55 PM
From: E_K_S	Respond to of 34328

Re: Dividend Yield History Interesting. Reversion to the mean but use the dividend yield as the measure rather than price. This would account for dividend increases over time. A good concept but the time data series for yield might be harder to find vs the price history. I guess you could also measure the dividend yield vs the mean S&P rate. If you calculate the net historical real return rate (take the S&P 500 mean yield & subtract the individual stock dividend yield) and follow this over time. Buy when the net rate has the highest yield and sell when it is low. The key is to keep the funds always invested so as to get the compounding working but from time to time "tweak" the yields by selling those companies (or at least peeling off some shares) (1) when the yield is at or below it's historical norm and/or (2) when the net yield (when compared to the S&P 500) is at or below the historical norm. FWIW - Intel trading over 83 million shares today based on their increase dividend news. I guess Dividends Still Matter. EKS

To: chowder who wrote (6373)	11/12/2010 3:23:17 PM
From: deeno	Respond to of 34328

I agree that valuation, regardless of methodology, is something most dont weigh high enough. Buying a dip is not the same as buying value. I also think that using historical yields to form a sell strategy provides a shield against underperformance versus indexes like the DOW over the long run. Bravo. Its easy to pick 'em when the tide is behind you, especially over the last few years, staying away from the ones that swoon big time because they are priced like growth stocks instead of the income payers they are keeps your portfolio fresh.