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chowder

chowder
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  • Retirement Investing For Income ONLY: Doing It The Right Way [View article]
    A company paying a 4% yield and having a 70% payout ratio sounds like a utility company and most utility companies wish to be at the 70% rate. They aren't growth companies. It's not like they are going to expand into China and other countries. They are limited in the amount of profit they take in and have huge cash flows from people paying their electric bill. So, some of the cash goes to investors.

    Tobacco companies can afford high payout ratios as well. They can't advertise, they are not capital intensive where they need a lot of upgrades, they generate a ton of cash. Share-owners are rewarded.

    REIT's have to have high payout ratios by law. MLP's choose to do so as well. All fine by me.

    Is there a company with an 8% yield and a 35% payout ratio? I'd like to look into that one if it exists.

    When you see low payout ratios, it isn't an indication that they have room to grow the dividend. It's an indication they still need considerable amounts of cash to grow the business. Everything is relative.
    Oct 21 09:09 PM | 1 Like Like |Link to Comment
  • I Feel Like A Thief Buying IBM At Today's Low Valuation [View article]
    I use a model similar to Chuck's and for the record, I own IBM, KO, LMT and MCD, all with bad earnings or price hits, and my portfolio was still up on the day. Go figure.
    Oct 21 08:47 PM | Likes Like |Link to Comment
  • Retirement Investing For Income ONLY: Doing It The Right Way [View article]
    The Pure Non-Income method ... don't worry, be happier? ...
    Oct 21 08:25 PM | 1 Like Like |Link to Comment
  • Retirement Investing For Income ONLY: Doing It The Right Way [View article]
    Bruce, you assume correctly. Market risk is not a concern for me. I ignore market risk.

    Company risk is my main concern, which is why I focus on quality.
    Oct 21 08:07 PM | 5 Likes Like |Link to Comment
  • Retirement Investing For Income ONLY: Doing It The Right Way [View article]
    @Ooi ... >>> I agree with you that a dividend portfolio carries risk. <<<

    Fact is, any investment vehicle carries risk. Risk is risk and dividend growth investing doesn't carry any additional risks that non-dividend growth investing carries. In fact, I would opine that anyone involved in purchasing high quality dividend growth companies are exposed to lower risk than most other styles of equity investing in that in order to be a high quality dividend growth company, you have to be a mature and successful business.

    Although it's true that some long-time dividend growth companies will cut or freeze the dividend, most of the ones I experienced were still showing significant capital gains when I decided to sell them for lowering the dividend.

    Just because I focus on the income and income growth doesn't mean I don't get to experience capital gains.
    Oct 21 07:50 PM | 3 Likes Like |Link to Comment
  • The New Nifty Fifty, Part 1 - Dividend Growth Style [View article]
    Miz, when I say engaged, I mean ... beer - engage.
    Oct 21 07:31 PM | Likes Like |Link to Comment
  • Is Dow 17,000 Dangerously High? This Comprehensive Review May Surprise You! [View article]
    @giorgio ... >>> I believe advisor is a funds guy, an indexer as it were. <<<

    Got it! That makes sense. That way there's no personal responsibility and he can always blame the market or the guy picking the stocks that go into the index. Sort of allows him to always be right in his mind.
    Oct 21 06:42 PM | 3 Likes Like |Link to Comment
  • Is Dow 17,000 Dangerously High? This Comprehensive Review May Surprise You! [View article]
    I'm confused advisor. You don't use historical information, you don't use forward looking information, just what do you use?
    Oct 21 01:16 PM | 2 Likes Like |Link to Comment
  • Is Dow 17,000 Dangerously High? This Comprehensive Review May Surprise You! [View article]
    advisor ... Ha! Ha! Okay, let me help you out. If the CEO is befuddled, if they don't get their acts together the board will replace em. Nothing new there.

    You think Warren isn't going to pressure KO into doing something?

    Do you really think that in all the years these companies have been in existence they haven't faced adversity? Some of that adversity much more serious than what we see today?

    And I'm sure you're going to share a better way of looking at things and provide examples. I am so excited over hearing your solutions I'm about to bust.
    Oct 21 01:12 PM | 5 Likes Like |Link to Comment
  • The New Nifty Fifty, Part 1 - Dividend Growth Style [View article]
    Percy is my drinking buddy!

    In the old days I used to listen to a football prognosticator program called Leonard's losers. Instead of giving you the winners, he'd give you the losers and the analysis behind his picks are legendary.

    At the end of his show he'd always say, okay Percy, get me outta here!

    Percy's spirit lives on with me. Anytime I'm ready for a beer, I say okay Percy, bring me another. Those who have met me, met Percy! He was there! ... Ha!

    Percy and I are now engaged, we're drinking Stella in preparation for futbol today. Got my Schalke jersey on, will be rooting against Bayern and still undecided on Chelsea.
    Oct 21 01:01 PM | 1 Like Like |Link to Comment
  • Retirement Strategy: Avoiding The Pitfalls Of Fear And Winning The 'Game' [View article]
    Sounds like a good plan as long as the fund is of high quality.

    I'm under the impression this is a tax management tactic in a taxable account, and if that's the goal, then it seems to be a common sense approach.

    You can also achieve similar results, (for diversity), if tax management is the objective, if you invest in high quality CEF's that pay ROC (return of capital) since the ROC portion of the dividend isn't immediately taxed.

    You can invest in MLP's which also defer taxes.

    These ideas are based on one investing in their taxable account.
    Oct 21 12:54 PM | Likes Like |Link to Comment
  • Create Your Own Miniature Berkshire Hathaway [View article]
    I'm not discounting the luck aspect. Luck applies to everything including the egg that created us and the fact we're still alive, while others aren't.

    I'm merely addressing the insurance aspect of your comment.

    In order to sell insurance, a company has to have reserves. Those reserves have to have a dollar to dollar match, or at least it used to. I remember where banks only had to have 10 cents of reserves for every dollar of exposure, therefore making insurance companies a safer investment than banks.

    If a company doesn't have the cash to represent a dollar to dollar risk exposure, they have to put something up as collateral. States will vary on what they allow that collateral to be.

    The odds of your scenario playing out were very low, that's how we should invest. Go with high quality, low risk.
    Oct 21 12:45 PM | 1 Like Like |Link to Comment
  • Is Dow 17,000 Dangerously High? This Comprehensive Review May Surprise You! [View article]
    People are over-thinking it, in my opinion.

    When I look at forward estimates, I'm not focused on the exact amount, I'm focused on the trend of most analysts thinking who will do better than others going forward.

    If the market drops, price expectations and earnings expectations may not be achieved, that's common sense. However, the company that most analysts thought should have the better forward looking expectations has a higher probability of not dropping as far those who didn't have the same ratings. Everything is relative for crying out loud. ... Ha!

    When a company is down 8% on the year and the market is down 12%, the 8% company still outperformed the market.
    Oct 21 12:03 PM | 6 Likes Like |Link to Comment
  • The New Nifty Fifty, Part 1 - Dividend Growth Style [View article]
    This isn't a very good day for me. I'm being reminded of the pitiful mistakes I've made in the past, thought of another. I invested in some voice technology company that starts with a M. I can't remember the name or their symbol, but GM used them in their cars back when GM first came out with the computer system you spoke to.

    I put a good amount of cash into that one figuring now that GM was using it, the rest of the world was going to get wise and I was going to become rich off that one company. ... It didn't work out. Worst part was I went back to it twice more, losing each time, but thinking it was turning around for the better and I wanted to make my money back.

    Learn from the mistakes of others folks. You won't live long enough to make them all yourself. I have enough to share for everyone!

    Things are going to turn for the better now, Percy and I are engaged! Heading down to the pub for futbol babee. Champions League to be exact.
    Oct 21 11:53 AM | 1 Like Like |Link to Comment
  • Retirement Investing For Income ONLY: Doing It The Right Way [View article]
    I'm assuming that "pure income" is going to be a way to insure the 4.8% is achieved. I'm assuming we'll be seeing some preferred stock included where the dividend is fixed, doesn't grow. I'm assuming if the risk is acceptable, we'll see some bonds included if in excess of 4.8%, or even 4% for that matter if something else providing a higher and safe yield will help balance the difference. I'm assuming we'll see a blend among various investment vehicles where the blended yield will be a constant 4.8%, while maintaining a "low-risk profile."
    Oct 21 10:09 AM | 1 Like Like |Link to Comment
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