Seeking Alpha

Dale Roberts

 
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  • Are You Beating The Market? It's Important To Know
    Sun, Dec. 14 RSP, SPY, VOO 54 Comments

    Summary

    • Benchmarking is a crucial practice of most businesses and it is also important when it comes to the business of managing your portfolio.
    • If you are not beating the simple benchmark or index, you may be leaving money on the table. The monies can be meaningful and life-changing.
    • If you are beating the market, the benchmark can help you identify why and how you are beating the market, and provide direction on future success.
    • Assessing your success or failure is not an easy process. It is extremely difficult for investors to accept 'they did not win'.
    • Benchmarking can help identify weaknesses in your approach, and suggest methods of improvement.
  • Vanguard Dividend Growth - Beating The Market With Regularity
    Editors' Pick • Fri, Dec. 5 VDIGX 254 Comments

    Summary

    • In a recent article, I looked at the approach of Vanguard's Managed Dividend Growth Fund vs. an income approach popular with Seeking Alpha authors.
    • It's probably helpful to clear up the distinction between VDIGX's dividend growth years and its utilities income period.
    • Since its move to a dividend growth oriented fund, VDIGX has beat the market to date, over 7, 8, 9, 10, 11, 12 and 13-year periods.
  • Going Off CCC List To Find Total Return For Dividend Growth Investors.
    Editors' Pick • Thu, Dec. 4 VDIGX 106 Comments

    Summary

    • In recent articles, I looked at the Nifty Fifty of the market-beating and wonderfully managed dividend growth fund from Vanguard.
    • The Vanguard Fund VDIGX has beat the broader market and likely most dividend growth investors by taking a different approach compared to Seeking Alpha authors.
    • We see that VDIGX does not chase yield, it pays attention to payout ratio and it might even have a different definition of dividend growth at times.
    • We will have a look at a few of the companies held by VDIGX that are not Champions, Challengers or Contenders.
  • Dividend Growth: Seeking Alpha Style Vs. The Professional
    Tue, Nov. 25 VDIGX, VIG 110 Comments

    Summary

    • In a recent article I suggested that the wonderfully managed Vanguard Dividend Growth Fund might make a Nifty Fifty.
    • The fund has a history of beating the markets and delivering on the total return potential of dividend growth investing.
    • We'll look under the hood of the holdings (read the tea leaves) and see how the approach compares to the Seeking Alpha Nifty 50 for dividend growth.
    • You'll see that there is a distinct and different approach of the Vanguard manager vs the "Seeking Alpha" approach.
  • The Real Nifty 50 For Dividend Growth Investors
    Tue, Nov. 18 VDIGX 155 Comments

    Summary

    • A recent article series polled several Seeking Alpha authors and asked them each to select 50 dividend growth companies.
    • That list was trimmed down to a list of 39 where there was some consensus among the panelists, we'll have a look at that group.
    • Ironically there is a real 50 company portfolio put together by a dividend growth investor with a history of beating the market - the Vanguard VDIGX fund.
    • In a series of articles we'll examine the obvious differences between the approach of a Fund Manager and the Seeking Alpha authors.
  • What Happened To The Dividend Growth Investor - The Most Telling Examples
    Tue, Nov. 11 AIG, BAC, C 57 Comments

    Summary

    • In recent articles I demonstrated what might have happened to a retired dividend growth investor through the Great Recession. Was it a fair portfolio proxy?
    • The example portfolio had a core of dividend stalwart companies that made it through the Recession with flying colours, perhaps that was too generous.
    • We'll compare the portfolio proxy to the Dividend Aristocrats and indices and funds such as Vanguard's VIG and VDIGX.
    • This might be the most accurate take on what might have happened to a dividend growth investor who had to navigate through the Great Recession.
  • What Happened To The Dividend Growth Investor Who Didn't Cut And Run
    Editors' Pick • Wed, Nov. 5 CLX, KO, MCD 436 Comments

    Summary

    • The Great Recession provided a period of unprecedented dividend disruption, with many dividend growth stalwarts cutting, holding or eliminating their dividends.
    • We'll have a look at a portfolio example that experienced a dividend cut. The investor holds the dividend cutter through the recession.
    • We'll take a look at the results of buy and hold on a dividend cut compared to the cut and run policy.
  • Do You Have A Written Plan Of Attack For A Real Correction?
    Thu, Oct. 30 DIA, SPY, QQQ 8 Comments

    Summary

    • The recent "correction" should certainly be in parenthesis, nothing really happened.
    • That little head fake provides a wonderful opportunity for investors to reflect on what they did, and what they might do in the even of a real and meaningful correction.
    • What did you do? Certainly it was easy to buy a few stocks or funds, but was it worth it? Did you just waste some dry powder?
    • Do you have a plan for the next correction? Do you think you will be able to execute that plan?
  • When Rates Spiked Violently Did The Balanced Portfolio Get Whacked?
    Wed, Oct. 29 SPY, DIA, QQQ 28 Comments

    Summary

    • We know that longer dated bonds can get hit hard in price terms when rates spike.
    • Today's investor has largely known the good times for bonds with yields generally falling for the last 30 plus years.
    • Previous to this most glorious time for bond investors was the worst of times. From 1950 to 1981 the yield on a 10 year treasury went from 2% to 14%.
    • So what happened to a balanced portfolio in this period? What was the cost of holding bonds in the worst of bond bear markets.
    • We'll look at the Vanguard Wellington Fund and how it fared in the bond bear vs the bond bull.
  • What Likely Happened To Dividend Growth Retirees In The Recessions
    Editors' Pick • Wed, Oct. 22 BAC, COP, GE 175 Comments

    Summary

    • The Great Recession delivered the greatest challenge to dividend investors.
    • Many dividend stalwarts delivered dividend cuts, holds or eliminations forcing investors and retirees to make some tough decisions.
    • What happened to an investor who used dividend growth through the recession, and who had to cut and run on some dividend growth holdings?
    • We'll see that a dividend growth core offered some wonderful recovery potential.
    • I run the numbers on a dividend growth proxy portfolio that holds a core of consumer dividend payers along with a popular holding that offered a dividend cut.
  • Portfolio Keeping You Up At Night? Take One Of These
    Editors' Pick • Thu, Oct. 16 AGG, LQD, SPY 42 Comments

    Summary

    • The recent stock market correction has been picking up steam.
    • If you are feeling a little uneasy, it may be time to add an investment that has a history of going up when the markets went down.
    • Long-term Treasuries and other bond funds have once again "done their thing" in the recent correction.
    • It's not too late to create your SWAN, or Sleep Well At Night, portfolio.
  • How Retirees Made It Through The Last 2 Recessions
    Tue, Oct. 14 CMCSA, CVX, GE 26 Comments

    Summary

    • Many retirees faced a very challenging retirement date from 1999-2002 as they had to navigate through two of the most substantial market declines.
    • An all-equity portfolio of any kind would have been challenged and would likely be very wobbly coming out of the Great Recession.
    • Sequence of return risk should be addressed for most retirees; the equities that deliver that inflation protection must be protected in market downturns.
    • This article provides a very simple asset mix and portfolios that made it through, from 2000, with flying colours.
    • The portfolios allowed investors to spend 4% of assets with a 3% annual inflation adjustment from 2000 to present. Now that's a stress test!
  • For Retirees, Have The Last 15 Years Been The Worst Of Times? Ever?
    Editors' Pick • Tue, Oct. 7 CL, JNJ, KO 64 Comments

    Summary

    • Funding retirement is tricky business, to say the least. What works in one period may not work in the next.
    • Stocks have typically provided the growth engine that allows retirees to beat inflation and maintain an aggressive spending strategy - and maintain that quality of life.
    • But investing in the equity markets takes on additional risks for the retiree, as selling stocks in down years can cripple the portfolio.
    • The last 15 years have been perhaps the most trying time for retirees, especially those who began retirement in 1999 to 2001.
  • Retirees, Don't Count On Stocks To Deliver From Here
    Editors' Pick • Tue, Sep. 30 SPY, VTI 140 Comments

    Summary

    • Many retirees count on the stock markets to deliver the robust growth required to beat inflation and provide an aggressive inflation adjusted spending rate.
    • The stock markets have periods when they have provided 14% plus inflation adjusted annual gains.
    • In periods of high growth, a retiree was typically able to purchase or hold stocks at very attractive and sensible price to earnings ratios. Today is a different story.
    • From today, the equity markets may not provide the growth necessary to provide 4% inflation adjusted returns for retirees.
  • Retirees, The S&P 500 And Cash Are All You Need
    Editors' Pick • Wed, Sep. 24 SPY 190 Comments

    Summary

    • What simple portfolio survived 40 years that included stagflation, the tech meltdown and the Great Recession? The S&P 500 covered by cash.
    • This $1 million portfolio delivered nearly $5 million in income from 1972 to 2012.
    • The total return of the S&P 500 can do the trick and provide the growth necessary to help retirees beat inflation.
    • We'll have a look at the spending ratio of the portfolio and explore what is "the tipping point".
  • We Can't Redefine Risk, It's The Price Silly
    Tue, Sep. 23 DIA, SPY, QQQ 31 Comments

    Summary

    • Investors on average have performed poorly due to the emotional reaction to stock market price swings.
    • Too many investors typically do a lot of buying near the tops (when they feel comfortable) and then sell when prices are falling as they are gripped with fear.
    • It may be dangerous to try to redefine risk, or suggest that investors who address risk are just pessimists looking for the downside.
    • Quite the contrary, any intelligent investor is an optimist by trade. One has to be a long term optimist to invest in the stock markets.
    • It may come down to Mr. Buffett's suggestion that if you can't handle a 50% correction, don't invest in the stock markets.
  • In The Next Correction, Will You Be A Winner Or A Loser?
    Editors' Pick • Wed, Sep. 17 AGG, CSCO, JDSU 169 Comments

    Summary

    • As they say, we all look and feel like geniuses in bull markets, but it is in the market corrections when money is gained or lost.
    • The vast majority of investors have a habit of buying near the top and selling near the bottom, are you prepared to go against the crowd?
    • Are you prepared for a market correction, or collapse? What is your risk tolerance level?
  • There's Very Little Chance Of Beating A Balanced Portfolio From Here
    Editors' Pick • Wed, Sep. 10 AGG, SPY, TLT 73 Comments

    Summary

    • This is now the 4th longest bull market in history. We're in the 2nd longest period without a 10% correction. Every day, we get closer to the next correction.
    • A re-balanced growth portfolio that holds a modest 25-35% bond component offers the possibility of delivering stock market like gains (or better) with a much lower risk profile.
    • The risk return proposition is likely swinging in favor of a balanced portfolio. It might be time to listen to Mr. Benjamin Graham.
  • Thanks Burger King For The Whopping Profits: Here's Where The Money Went
    Editors' Pick • Tue, Sep. 9 BKW, BRK.B, SPY 41 Comments

    Summary

    • I only hold 4 individual stocks, well now that's 3 thanks to Burger King purchasing my favourite known as Tim Hortons.
    • I sold 2/3 on the day that it was announced with a 22% spike, and then 1/3 the following day with another 10% increase in profits. Tim Hortons delivered 250%.
    • Tim Hortons delivered a 250% return from March of 2006 to September 2014, a wonderful and rare gift for an investor.
    • Cash is king, but we need to be in the markets as well. Perhaps I can have my cake and eat it too.
  • In Defense Of The Shiller CAPE Ratio - It Works!
    Tue, Sep. 2 SPY 25 Comments

    Summary

    • The Shiller CAPE ratio measures the price of companies with respect to earnings with a blended approach that takes into consideration a 10 year history of earnings.
    • We should remember that Mr. Robert Shiller does not suggest that an investor use CAPE as a market timing device to get in or out of the markets.
    • The CAPE ratio does offer long term predictive powers, estimating a range of probable stock market returns from a PE level.
    • The current CAPE ratio suggests that today, we are likely looking at very meager or negative returns over the next decade.
  • Dividend Growth Investors, Prepare To Boost Your Returns
    Tue, Aug. 26 AGG, SPY, TLT 39 Comments

    Summary

    • Selecting a group of dividend growth companies can provide a lower risk or lower volatility portfolio.
    • That lower-volatility portfolio may help some investors weather the next storm, but dividend payers can fall hard as well.
    • I fear that many dividend growth investors have not conducted a true personal risk assessment.
    • There can be a false sense of security when it comes to dividends; even the dividends may not hold up in a major correction.
  • Selling My Tim Hortons Was A No-Brainer.
    Tue, Aug. 26 AAPL, BKW, THI 28 Comments

    Summary

    • Tim Hortons was the only stock that I held "on purpose".
    • Tim's was a great story, the strongest brand in Canada - they sell 8 out of 10 cups of quick serve coffee in Canada.
    • Burger King is looking to purchase Tim Hortons, I don't think they would understand what kind of company it is, and how to continue with this incredible solid growth story.
  • Warren Buffett Hates Bonds, Loves Cash
    Wed, Aug. 20 SPY, BRK.A, BRK.B 48 Comments

    Summary

    • Warren Buffett is sitting on his largest cash pile, ever. Warren has a very big chest, war chest that is.
    • Warren chooses cash over bonds for the obvious reason that cash is liquid and available. It's dry power that he can quickly fire.
    • What can we learn from Warren Buffett and his Berkshire Hathaway Funds sitting on cash for a couple of years, not finding much that is investment-worthy?
    • Warren Buffett looks at cash differently than would you and I; to Mr. Buffett cash is a call option that can be priced.
  • The Same Returns With Half The Risk?
    Fri, Aug. 15 AAPL, AGG, EFA 49 Comments

    Summary

    • I created and hold a very low beta portfolio that I have transposed to U.S. holdings.
    • With the return of very modest volatility that portfolio mix has outperformed the broader markets in 2014.
    • Are we again in a scenario where the balanced portfolios will potentially outperform the all-stock portfolios over the next several years?
    • In the scenario of a market correction, the best risk adjusted returns may come from a prudent mix of stocks, bonds and cash.
  • How Dividends Don't Matter In Retirement; A Few Examples
    Editors' Pick • Thu, Aug. 7 BRK.A, BRK.B, NOBL 518 Comments

    Summary

    • Recently I wrote an article entitled Dividends Don't Matter In Retirement Either. Here are a few simple scenarios that demonstrate the power of stock price growth for retirees.
    • It all comes down to the earnings power of your companies. Dividends can help us find that profitability.
    • Investing for total return, even in retirement can be the path to the most successful retirement, with the most income available.
  • I'm Not Selling Anything, I'm Buying Everything
    Thu, Jul. 31 AAPL, VIG, SPY 97 Comments

    Summary

    • Recently, a Seeking Alpha author admitted to selling most everything due to fears of a market pullback and market over-valuation.
    • In my opinion, this author is not yet an investor, but thanks to some recent experience and introduction to emotional risk, he may be on his way.
    • This author teaches us that it is paramount to first have a plan when investing, a plan that prepares us and tells us what to do in any market condition.
  • The Stocks Catch The Bonds - 6.5 Years Later
    Editors' Pick • Tue, Jul. 22 EFA, EWC, SPY 30 Comments

    Summary

    • The year 2008 provided a very poor start date for monies invested in most stocks.
    • From 2008, a typical bond heavy portfolio has outperformed a balanced and balanced growth portfolio that would offer double or more the stock exposure.
    • Sometimes, the market announces that we proceed with caution - is this one of those periods where perhaps returns will be nil or minimal in the short-to-mid term?
    • According to the Shiller Index, this is the third-most expensive market in market history.
  • Dividends Don't Matter In Retirement Either
    Editors' Pick • Thu, Jul. 17 SPY, DGRO 764 Comments

    Summary

    • Stocks are the best performing asset class that provide the best opportunity for growth and returns that can beat inflation.
    • What drives that growth is the earnings power of a company; the actual dividends do not drive earnings power, they are a reflection of that earnings success.
    • Most would agree that the dividends don't matter in the accumulation phase, but the same holds true when harvesting in the retirement phase. What matters is earnings growth.
  • Getting The Returns Without The Risk
    Editors' Pick • Tue, Jul. 8 SPY, TLT 105 Comments

    Summary

    • A bond ladder can typically deliver the total return of the longest dated bond within the ladder.
    • Bond laddering can greatly reduce the chance of having a negative year, even within a bond bear market.
    • What's the sweet spot for the duration of a bond ladder if one fears a rising rate environment?
  • Cutting My Dividends By 35% - Improving My Dividend Growth Portfolio
    Mon, Jun. 23 NOBL, SDY, SPY 126 Comments

    Summary

    • Most dividend growth investors on Seeking Alpha appear to invest for yield, that is likely leaving money on the table.
    • Dividend growth offers the opportunity to outperform the market with respect to total return, but the magic is growing dividends, value and a low payout ratio.
    • I have left behind the higher-yielding Vanguard VYM, and moved into the more pure dividend growth play of the much lower-yielding VIG.
    • We should always remember that in the accumulation phase, all that matters is total return matched to the investor's risk tolerance level.
  • How To Outlive Your Money: A Lesson From Canada
    Mon, Jun. 16 SPY 155 Comments

    Summary

    • Canadian policy mandates that retirees remove 7.48% in their 72nd year. That level of drawdown is a recipe for retirement disaster.
    • The 4% drawdown rule may not apply in current conditions. 3 may be the new 4 when it comes to spending rates in retirement.
    • We'll examine the likely outcome of withdrawing at that high rate over the next couple of decades.
    • We humans are living much longer, and adjustments have to be made. How do we make our money last as long as we do?
  • The Time Warren Buffett Got It Wrong
    Editors' Pick • Wed, Jun. 11 SPY 89 Comments

    Summary

    • Warren Buffett has suggested that a retiree might hold a mix of 90% equities and 10% bonds.
    • The all-stock portfolio actually works quite well funding 4% or more of portfolio value, inflation adjusted, over most 30 year periods.
    • But the equity portfolio increases risk during years of successive market declines.
    • We'll have a look at the 90/10 portfolio for retirees, a 60/40 mix, along with bucketing with cash and bonds to fund retirement in stages.