One of the differences between my dividend screens and others is perhaps looking at yield at the end of everything. This economic downturn have hit home the point that investing in dividend companies are not that safe and out-performing as I imagine.
The Dividend Aristocrats is abit different. They are the stocks that managed to raised their dividends for 20 years or more. Expanding dividend payments isn’t the end of story. My initial thoughts is: Having a stock that is low growth but high-yield is equivalent to one that is low yield and reasonable growth.
I think that opinion is flawed now. This recession hammers home the point that whatever it is, the ultimate determinating factor is more than yield and growth. Its business sustainability and cashflow generation. dividend aristocrats are much better in that sense because they obviusly have some moat in their model to enable them to raise dividend for 20 years.
In contrast, high yield plays traditionally have reached the apex of their cashflow generation capability. this is to say that future growth is limited. The danger of it is that the most likely way to go is down and probability of upside is limited.
Kyith is the Owner and Sole Writer behind Investment Moats. Readers tune in to Investment Moats to learn and build stronger, firmer wealth foundations, how to have a Passive investment strategy, know more about investing in REITs and the nuts and bolts of Active Investing.
Readers also follow Kyith to learn how to plan well for Financial Security and Financial Independence.
Kyith worked as an IT operations engineer from 2004 to 2019. Currently, he works as a Senior Solutions Specialist in Insurance Start-up Havend. All opinions on Investment Moats are his own and does not represent the views of Providend.
You can view Kyith's current portfolio here, which uses his Free Google Stock Portfolio Tracker.
His investment broker of choice is Interactive Brokers, which allows him to invest in securities from different exchanges all over the world, at very low commission rates, without custodian fees, near spot currency rates.
You can read more about Kyith here.
- My Dividend Experience Investing in UCITS iShares iBond Maturing in 2028. - April 23, 2024
- We Invest into Popular Funds When They Are Popular, Exactly When They Started Turning to Shxt. - April 22, 2024
- Meal Prep 2.0 – Cooking Your “Go-to” Meal that You Look Forward to Eating Everyday. - April 21, 2024