No Free Cake

Bond and Stock Price Returns vs. Total Returns

I don't think using DVY as a proxy for "dividend stocks" is a fair telling of the story for the time period shown. DVY was heavily weighted in financials in this time period and, as we all know, financials badly underperformed. Just look at a price chart for XLF for this time period and you can see what impaired DVY.

DVY's underperformance shouldn't indict a dividend strategy in general or other dividend stock products that were more balanced. It's a good lesson learned about highly concentrated portfolios - but not dividend stocks.

Construct a Fixed Income Portfolio with 5%+ Dividends Using ETFs

Was anyone else confused reading this? If the author is going to discuss bond ETFs in the same breath as equity ETFs he should be clearer what sentences pertain to what.

Such as when he suggests digging into each ETFs holdings to determine each company's payout ratio. How does that apply to the bonds, REIT, or even preferred stock ETFs mentioned? Huh?

And, frankly, talking about "dividends" for equities and bonds at the same time is very odd to me. Bond prices, by definition, hover around some baseline (par) whereas equity pricing has no similar bound.

There are some potentially interesting ideas here, but, I think better care should have been taken in the presentation.

Which Way Are Markets Moving?

These charts will likely look decidedly different in about 12-15 days once the pre-Oct crash values wash out of the 200-day MA.

What's the Trend? Where's the Price?

Oh, sorry Richard. I assumed when you said you would correct the blog chart that the numbers would reflect SMA rather than EMA.

In your previous articles you used SMA - such as your recent "15 Point TechCheck" for example. Why the change to EMA?

What's the Trend? Where's the Price?

The blog link you specify still says that VWO is 10.2% above SMA rather than 25.5%.


On Jun 04 03:34 PM Richard Shaw wrote:

> Your calculations are correct. We used Exponential Moving Averages
> and erroneously used the label Simple Moving Average. The error is
> corrected on our blog ( www.qvmgroup.com/inves...
> ) and we have requested a correction on this SA republication of
> our article. Sorry and thank you.

Stock vs. Bond Performance

American in Paris writes: "Finally, the pre 20th century data isn't relevant because regulations were lacking to inspire confidence in equity markets. I wouldn't trust any data prior to the Great Depression reforms"

I write: Oh, you mean compared to the regulations we have now which inspire such confidence?

(sorry, couldn't resist)