richandmer

Dividend Investors Watch Out

Investors who have owned stocks like IP and PNC for any length of time have watched the value of their investment deteriate over the year or so. They did not "chase after the Crazy high yields" - as you state.

Keep in mind that the yields probably were not Crazy when they bought the stock. And just because they are now high doesn't mean that it gives the company the right to drop them 80 or 90% to get them back to reasonably Low rates. Is it written somewhere that when prices drop and yields rise, that the company is supposed to cut their dividend so that it always is maintained at low rates?

Maybe they should change the rules for bonds and other debt securities to be the same way. It yields rise over a specified amount, then the company should reduce the amount that it owes the bond holder. How does that sound?