What Drives Future Investment Returns?

Jun. 29, 2015 11:03 AM ETPEP, T, VZ
Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Dividend Growth Investing

Contributor Since 2008

I have been focusing my attention particularly to companies that regularly increase dividends to their shareholders for over a decade. I have also written about about dividend growth stocks on Seeking Alpha and my website for over a decade.


I am mostly a buyer of high quality dividend stocks, with solid competitive advantages. My holding period is forever - for as long as the dividend is at least maintained. I tend to concentrate my efforts on stocks which grow earnings and dividends, which provides outstanding total returns over time. I only focus my attention to stocks with sustainable dividend payments. I am also a firm believer in diversification accross sectors and geographic locations. I am a patient buy and hold investor, who believes that having an investment plan, investing regularly per your plan, staying the course, and keeping investment costs low are the best tools in the arsenal for the individual investor.


I share my thoughts on investing in dividend paying stocks that have consistently increased their payments over time and tips on growing my dividend income. I hope that my blog will serve as an inspiration for my readers and that it would change their financial lives for the better. 

There are several factors that drive future investment returns. The important drivers behind future returns on equity investments include:

1) Attractive Entry Price
2) Adequate growth in earnings
3) Dividend Safety
4) Strategic dividend reinvestment

While these are important drivers of future returns, it is equally important to keep as much of any returns as possible. In order to do that, investors need to be mindful of all costs. In order to reduce taxes, it is advisable to place as much shares as possible in a tax-deferred account such as a Roth IRA for example. In taxable accounts, it is advisable to refrain from too much trading, in order to let the power of tax-deferred capital gains on long-term holdings do its magic. The other way to keep costs low is by putting money in the lowest cost broker. In my situation, this is Interactive Brokers, which charges me 35 cents/investment. It feels like a steal.

Continue Reading >>>

Recommended For You

Comments

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.