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The Part-time Investor

 
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  • Dividend Growth Investing, Total Return, And Indexing Revisited [View article]
    CYR,

    So now we have to start arguing religion???? PLEASE NO!!!!!!!
    Nov 24, 2014. 01:36 PM | Likes Like |Link to Comment
  • Dividend Growth Investing, Total Return, And Indexing Revisited [View article]
    WCI,

    What if my portfolio, as a whole, beats your index. Should that not be acceptable? Must I trade in and out of stocks on an individual basis if they fail to beat the index over a specific time period? And what is that time period? 10 years? 5 years? 1 year? One day?? Please explain to me exactly how you think I should carry out your suggestion of "your DGI stocks should do at least as well as an index fund".
    Nov 24, 2014. 01:10 PM | 2 Likes Like |Link to Comment
  • Dividend Growth Investing, Total Return, And Indexing Revisited [View article]
    WCI,

    Must every single stock I own beat the market?
    Nov 24, 2014. 01:00 PM | 2 Likes Like |Link to Comment
  • Dividend Growth Investing, Total Return, And Indexing Revisited [View article]
    2Reb,

    I read that book, and the problem I have with the technique is exactly what you said. You must keep cash on the sideline to buy when your returns are down. The problem is with a long down turn in the market you pretty quickly run out of sideline money and the plan fall apart.
    Nov 23, 2014. 09:06 PM | Likes Like |Link to Comment
  • Dividend Growth Investing, Total Return, And Indexing Revisited [View article]
    DVK,

    I hope you don't feel left out. My article was referenced here, and every one of my articles has a little bit of DVK in it since you've taught me so much. So you're included. :-)
    Nov 23, 2014. 09:00 PM | 1 Like Like |Link to Comment
  • Dividend Growth Investing, Total Return, And Indexing Revisited [View article]
    Varan,

    Was that timing the market comment in response to me? How would what I said be considered timing the market?
    Nov 23, 2014. 02:46 PM | 4 Likes Like |Link to Comment
  • Dividend Growth Investing, Total Return, And Indexing Revisited [View article]
    But Varan, If I don't like the decision a company makes concerning the income they send me I can sell that stock and move to another. I have much more control over my dividend income than I do over the capital appreciation of stocks, funds or ETFs.
    Nov 23, 2014. 02:16 PM | 4 Likes Like |Link to Comment
  • Dividend Growth Investing, Total Return, And Indexing Revisited [View article]
    WCI,

    But you wrote this article as a response, at least partially, to mine. My article took into account reinvested dividends, and that was essential to my contention that DGI offers superior TR. So it's not an accurate comparison.
    Nov 23, 2014. 01:37 PM | 8 Likes Like |Link to Comment
  • Dividend Growth Investing, Total Return, And Indexing Revisited [View article]
    WCI,

    First of all let me thank you for referring to my article and including me in your discussion. I am honored that you not only read my article, but also linked to it with yours. Thank you.

    Now for my criticisms.

    As has already been mentioned by others who commented on your article you limited your study to only 5 years. Yet the past 5 years has been a very strong bull market. I think every DGI proponent agrees that DGI will most likely under perform, on a total return basis, during strong bull markets. It is during bear markets that DGI really shines, yet you chose not to go back just 1 or 2 years more and include the 2008-2009 bear market. And why didn't you? Because, and I quote .....

    "I did not try to back test it for 20 years through our last two major recessions for a simple reason. I do not think that stock-picking is the best way to protect a portfolio through a major draw-down such as occurred in 2000 or 2008. That is the role of cash, gold, bonds, and bond equivalents (utilities and preferred stock) in appropriate proportions. You cannot create an all-equity portfolio with a beta of 0.5 and have reasonable alpha."

    So, if I understand you correctly, because you didn't think that picking individual stocks is the best way to invest during bear markets, you didn't bother to test what would have happened with Mike's Nifty Fifty if you had included the last bear market. Instead of showing whether or not the results would have confirmed your hypothesis, you didn't do the study, and just assumed you were correct.

    Secondly, in your argument to refute my article you ignored the main contention that I made. DGI portfolios out-perform during bear markets, and produce lower drawdowns. Secondly, a DGIer will continue to see dividend income rolling into their account, even if their stocks are falling in price. These two factors lead to less incentive for investors to sell at the worst time, when their stocks are down, and these are the main reasons why, IMHO, a dividend growth investor will produce better total return over time. You did not address either of these factors.

    Finally, the studies I referred to in my article were comprehensive studies covering decades of data. My article may not have been "scientific", but I believe that the studies I referred to were. And they were at least more thorough than the 5 years of data you chose to use.

    I appreciate your article, and I welcome further discussion of this topic. I actually find it fascinating, and I love the debate. But i think you should extend your investigation to include both bear and bull markets before you dismiss the total return possibilities of DGI.
    Nov 23, 2014. 01:00 PM | 5 Likes Like |Link to Comment
  • The Real Nifty 50 For Dividend Growth Investors [View article]
    Mike,

    You're right. I spoke a little too quickly. I meant someone managing their own portfolio, and considering using ETFs or funds rather than individual DGI stocks.
    Nov 22, 2014. 12:49 PM | Likes Like |Link to Comment
  • The Real Nifty 50 For Dividend Growth Investors [View article]
    "I was hoping to see a direct comparison between VDIGX vs SA panelist, but perhaps another time."

    For what it's worth (I'm not one of Mike's Nifty Fifty panelists) but my DGI portfolio is beating VDIGX by 6.40% this year and 11.74% over the past 2 years. And I think my performance is probably pretty typical for a DGI portfolio. You can see my latest update here:

    http://seekingalpha.co...

    I still can't see why anyone would choose VDIGX rather than managing their own portfolio.
    Nov 22, 2014. 11:38 AM | 3 Likes Like |Link to Comment
  • Dividend Stocks Are Not In A Bubble, But Many Of Them Are Pricey [View article]
    Trader,

    That is the problem I have with selling puts. I rarely buy as much as 100 shares at a time. Otherwise I would try them.
    Nov 21, 2014. 04:06 PM | 2 Likes Like |Link to Comment
  • Dividend Stocks Are Not In A Bubble, But Many Of Them Are Pricey [View article]
    Rose,

    You are absolutely correct. I use a limit order at the market price, just in case something weird happens and my execution goes through a buck or two higher then it should. The spirit of what I'm trying to say is that I don't wait for a lower price to buy, because that price may never come and I may never get the stock. If I want to own a stock I buy it!
    Nov 21, 2014. 04:05 PM | 4 Likes Like |Link to Comment
  • Dividend Stocks Are Not In A Bubble, But Many Of Them Are Pricey [View article]
    Yes. What DC said. Sorry I hadn't read his comment yet before I posted mine.
    Nov 21, 2014. 10:38 AM | 3 Likes Like |Link to Comment
  • Dividend Stocks Are Not In A Bubble, But Many Of Them Are Pricey [View article]
    William,

    Survival bias? Seriously? DVK was discussing whether or not DGI stocks are over valued TODAY. Right now. And his analysis showed their ratings from various sources RIGHT NOW. This was not a back test so survival bias is not applicable.
    Nov 21, 2014. 10:37 AM | 8 Likes Like |Link to Comment
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