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  • Learning From The Masters: Q&A Session With Buyandhold 2012 [View article]
    No need for regret, UberAlles .... We live in a modern investing world. An average investor doesn't have to cherry pick and buy individual stocks anymore. They can buy an ETF representing dividend growth, such as SCHD, which is a much more efficient way of getting exposure to the DG universe. I'm glad that we, the modern investor, don't have to pay the aggregate stock commissions that B&H2012 had to pay in the 70's, 80's, or even 90's, because they were quite a bit.
    Apr 27, 2015. 06:42 PM | 3 Likes Like |Link to Comment
  • Retired Dividend Investors Are Deluded By Yield On Cost [View article]
    Well stated ... "Investors will be better off building the largest pot of money, and then evaluating the best options to fund retirement once they are there."

    There seems to be a lot of attempted tweaking that goes on within the realm of individual DG stock portfolios' in terms of "yield", swapping stocks at "highs/low yield with stocks in corrections/high yield, using MLP's, etc. Yet, the results that I have gleaned from various portfolios and studies presented, are that if one has held a diversified portfolio of 30+ popular DG stocks, the total return CAGRs seem to have fallen somewhere between 10.5 - 12% over 20+ year periods since 1980's. So the work of ( beyond the "buy and hold" portfolio ) "tweaking"; holding a smaller sized portfolio, and/or using specialized sectors ( MLPs), may add an extra .5% - 1% extra to the CAGR and push the results into the higher part of the range ( 12% ). It's not like one is adding, for the work involved, a significant extra % to the total return CAGR that, say, a small cap value or deep value portfolio universe has historically proven to.
    Also, when I look at SA's "Dividends and Income" articles list, sometimes I feel like I am walking down the Vegas strip in the 80's seeing the flashing "marquees" : "A 6% yield On Stock X That Can Benefit From Rising Rates !" "10 Top Dividend Stocks with X Yields Upsides !"
    "X Stock Div Increase: Why I'm Expecting A Big Double Digit Increase !"
    " This High Dividend Stock Yielding 10% !"
    The novice investing household with the average $100K, age 50+ must run due diligence with these CAGR numbers and get a realistic assumptions on what all of this adds up to within their situation. These "sensationalist" titles may well "prime" them to expect a seemingly greater return than what reality will provide, especially when starting at a high overall market valuation.
    I also get the same effect with the way the Robo advisories promote their product, albeit in a different format ( and lesser return ) ....
    Apr 26, 2015. 10:07 AM | Likes Like |Link to Comment
  • Why I Purchased Schwab's U.S Dividend Equity ETF As A Dividend Growth Investment [View article]
    As Howard Marks says "Many times during crisis, correlations of assets go to 1" .. Chart 18 here :
    Apr 23, 2015. 11:31 AM | 1 Like Like |Link to Comment
  • Why I Purchased Schwab's U.S Dividend Equity ETF As A Dividend Growth Investment [View article]
    Good work ... something that is simple to calculate / follow and which produces robust results ... yet is above the aptitude of many ...
    Apr 22, 2015. 02:10 PM | 1 Like Like |Link to Comment
  • Why I Purchased Schwab's U.S Dividend Equity ETF As A Dividend Growth Investment [View article]
    One could also run a basic M. Faber MA process ( academically reviewed and mathematically logical process ) on the SP 500 and TLT, using QQQ for equity exposure ( exposure to 100 of the world's best growth stocks - some even paying dividends ) with further risk mitigation and improved returns. Doc link below shows performance vs. 10 stock "best DG favorites" "optimized" portfolio performance since 1986, and vs. Touchstone Premium Equity DG fund ( Lowell Miller, manager ) since 2007 ...
    Apr 22, 2015. 01:06 PM | Likes Like |Link to Comment
  • How To Trade Like Stan Druckenmiller, George Soros And Jim Rogers [View article]
    Victor Niederhoffer is an opposite example of this. He blew up his clients' accounts a couple times ...
    Apr 22, 2015. 09:10 AM | 2 Likes Like |Link to Comment
  • Chasing High Dividend Growth Rates For Lower Total Returns [View article]
    Feels like there has been an explosion of interest in and articles related to DG and it seems that people are coming to "expect" an oft repeated 30 + company names to provide them with growing dividends ... makes me uneasy ...
    Apr 21, 2015. 12:24 PM | 1 Like Like |Link to Comment
  • Why An Income Portfolio Beats Capital Gains Every Time [View article]
    The use of the word "compounding" when used in conjunction with the concept of "dividend reinvestment", can create misconception for the novice. A dividend reflects a deficit created from the disbursement of funds from the retained earnings side of the ledger via the accounting mechanism ( the company's value is reduced and reflected in a momentary drop in share price on ex div date ( although not directly noticeable in many cases)) . The "reinvesting" of that dividend back into shares by the investor only restores that "value" back into the stock's total "return".
    A way to exploit the deficit and momentary drop / discount in price and create "true" compounding ( geometric), would be = on the ex dividend date of a stock or stocks held in a portfolio within the DG universe, using "fresh" capital, buy additional shares in the amount of the price drop reflected by the (ex) dividend. Easy in theory, probably very difficult and time consuming to execute. Yet if it could be done, and since 79% (back to 1960) of the total return (of the SP500) can be attributed to the reinvestment/reemployment of the dividend *, then a portfolio's total return and terminal asset value on the first day of the "spending" phase of retirement would be further magnified through these share purchases.
    During accumulation phase, one MUST "reemploy" the dividend ( or disbursement from earnings ) back into the stock's / portfolio's "total return" part of the equation in order for the terminal value ( at retirement) of the portfolio to stay competitive with other portfolio "styles" total return trajectories/ terminal values ( for ex. small cap value, mid cap growth ). Then, during the de-acumulation/income phase, the importance of the "growth rate" of the dividend comes into play.
    Apr 19, 2015. 07:38 PM | 1 Like Like |Link to Comment
  • The Perfect Portfolio For Retirement Is An Illusion [View article]
    Much has been said about Buffet and his skill.
    A factoid about Buffet (vs. the average investor managing a conventional DG portfolio); in Oct 1987, he had $2B invested in THREE stocks; Cap Cities ABC, GEICO, and Wash Post. In May 1989, he acquired $1 B of KO ( representing 35% of portfolio ) which rose nearly 12 fold to $11.6 B by 1998.
    Also, Buffet is able to buy "entire" companies outright and change management structure. The average investor can't do that ...
    Hard to say what else we can take away from Buffet besides the benefit of "being patient".
    Apr 19, 2015. 10:34 AM | 2 Likes Like |Link to Comment
  • A Fink Speaks The Truth [View article]
    This corporate "financial engineering" using debt for non productive purposes ( share buybacks, dividends, M&A ) has been going on for at least the last 2 cycles ( 2003 - 2007; 2009 - ? and maybe the 1996 - 1999 period) with, in the most recent cycle, 90+% of the debt going for these purposes. This corporate debt growth is even higher ( by 50%) than the 2007 peak with more of it being "B" rated. If the precedent that has been set of activist shareholder pressure towards receiving ever increasing "growing" dividends without underlying organic company growth support continues, then there will have to be a value readjustment "somewhere". Buffet was smart in that he bought and owns the companies that have the wide MOATs and can control and steer the debt structure towards productive uses. DG shareholders may not be as fortunate as they may not be able able to know / find out exactly what's under the hood / if companies management is using the debt for non productive purposes or what the quality rating of the debt is. Non dividend paying company managements may be have to be more "honest" or "responsible?" in this regard.
    Apr 18, 2015. 11:44 AM | Likes Like |Link to Comment
  • Worried About A Market Bubble? You May Have The Wrong Strategy [View article]
    Not worried ... just following a model that is derived from empirically tested, robust, fact based process. Shooting for "maximizing" returns into terminal accumulation phase by using lowest fee index ETF's within the Roth structure. By following the model and being DIY, my clients and I eliminate the fees paid out to an advisor which, in the end, reduce the terminal asset amount by > 15% ( slide 16 in presentation below ). Investors "staying" invested into large possible market declines, run into behavioral risks ( selling out of fear ) more often than adding positions (while the model is in defense) because of the fear of "missing out".
    Apr 17, 2015. 05:52 PM | 1 Like Like |Link to Comment
  • Worried About A Market Bubble? You May Have The Wrong Strategy [View article]
    Nice data set ... thanks !
    Apr 17, 2015. 05:36 PM | Likes Like |Link to Comment
  • This Chart Suggests A Bear Market Could Be Lurking [View article]
    Further confirmation of defensive "cash" allocation in January of this year coming from a High risk profile year reading ( component 3 of the Map model ) within a component 1 + 2 annual return sequence :

    Many occurrences of meaningful market declines are also accompanied by declines in economic conditions index falling below threshold value and/or inverted yield curve :
    Apr 15, 2015. 10:06 PM | Likes Like |Link to Comment
  • Market Crash? Here's How I'm Beginning To Protect My Positions [View article]
    Returns data using "annual" time frames can provide much less "randomness" from which to extrapolate statistically significant outcomes than shorter frames ( weekly, daily, hourly, etc. ). The key is in the discovery of the sequence(s) of returns from the data that can lead to a valuative measure on which a "mean" can be produced and thereby construct mean "revision" rules on which non-subjective asset allocation decisions can be based. Most analysis is based on fundamental, dynamically "revisable" data series, making it difficult to create confidence and precision with asset allocation. Stock returns are final and "static". Also, the "long length" nature of the annual time frame creates impatience in an investor as, staying in a "defensive" posture for many months, is uncomfortable for many ...
    Apr 15, 2015. 01:07 PM | 1 Like Like |Link to Comment
  • Tune Out The Buffett Indicator [View article]
    Share count reduction ala buybacks also adds fuel ( recycling of capital ) to momentum mispricing. Also, a fact that many commentators forget about the 1994 - 2000 momentum run up, is that that during the last year and half ( mid 1998 - 1999 ), Greenspan/ the Fed was injecting reserves to counteract the "Y2K problem" ....
    Apr 14, 2015. 09:30 AM | Likes Like |Link to Comment