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I read somewhere about splitting control and ownership, but really you can’t. You either own a thing or you don’t. Time shares notwithstanding. I do like divid

I read somewhere about splitting control and ownership, but really you can’t. You either own a thing or you don’t. Time shares notwithstanding. I do like dividend paying stock, but is that not a form of short term thinking? “May me my dividend this quarter, I don’t care when happens next year!”

dweekly 9y ago
Re: splitting control and ownership, don't non-voting GOOG shares exhibit exactly this split as one example?
phkahler 9y ago
Dividends are the most reasonable way to get a return on investment. If you want to buy low and sell high, you're playing the greater fool game - why would anyone buy if you think it's time to sell. How should a company stock be priced? It's based on earnings, or in other words the ability to pay dividends. P/E ratio or price to earnings is a direct measure of the ability to pay dividends whether they pay them or not. At a PE of 20, the company could pay a 5 percent dividend. At a PE of 100 your stock purchase is misguided - you either expect the earnings to increase dramatically which would make the price more reasonable, or you expect someone else's investment decision to be more unreasonable than yours.
- charlesdm 9y ago
  I don't think I've ever bought a dividend share (just for the dividend) that has resulted in me getting an excellent yield. I'm personally not a big fan of purchasing stocks that fluctuate 10-20% up and downwards over the years while paying out, say, a 4% dividend. I'd rather put that money in a growth stock then.
- drveen28 9y ago
  > If you want to buy low and sell high, you're playing the greater fool game - why would anyone buy if you think it's time to sell. Because they think it is going even higher? "Fundamentals" are far from the only reason to be long an equity contract.
charlesdm 9y ago
In this day and age, most dividend shares are often not worth holding just for the dividend. Growth shares tend to generate much better returns in most cases. Buying a dividend share that can potentially go up however, is very nice though, such as when purchasing Apple several years ago.
jacques_chester 9y ago
> I read somewhere about splitting control and ownership, but really you can’t. You either own a thing or you don’t. In common law countries, trusts law means you can distinguish between who has controlling interest and who has beneficial ownership. So you can own a thing but not own the thing. If I own something on trust for you, I can control it, but only in your best interests. If you own it on trust for me, I can benefit from the ownership, but without a lot of other legal effects that would normally ride shotgun with a full and undivided ownership. As usual: I am not a lawyer, this is not legal advice.

dweekly 9y ago

Re: splitting control and ownership, don't non-voting GOOG shares exhibit exactly this split as one example?

phkahler 9y ago

Dividends are the most reasonable way to get a return on investment. If you want to buy low and sell high, you're playing the greater fool game - why would anyone buy if you think it's time to sell. How should a company stock be priced? It's based on earnings, or in other words the ability to pay dividends. P/E ratio or price to earnings is a direct measure of the ability to pay dividends whether they pay them or not. At a PE of 20, the company could pay a 5 percent dividend. At a PE of 100 your stock purchase is misguided - you either expect the earnings to increase dramatically which would make the price more reasonable, or you expect someone else's investment decision to be more unreasonable than yours.

charlesdm 9y ago
I don't think I've ever bought a dividend share (just for the dividend) that has resulted in me getting an excellent yield. I'm personally not a big fan of purchasing stocks that fluctuate 10-20% up and downwards over the years while paying out, say, a 4% dividend. I'd rather put that money in a growth stock then.
drveen28 9y ago
> If you want to buy low and sell high, you're playing the greater fool game - why would anyone buy if you think it's time to sell. Because they think it is going even higher? "Fundamentals" are far from the only reason to be long an equity contract.

charlesdm 9y ago

In this day and age, most dividend shares are often not worth holding just for the dividend. Growth shares tend to generate much better returns in most cases. Buying a dividend share that can potentially go up however, is very nice though, such as when purchasing Apple several years ago.

jacques_chester 9y ago

> I read somewhere about splitting control and ownership, but really you can’t. You either own a thing or you don’t. In common law countries, trusts law means you can distinguish between who has controlling interest and who has beneficial ownership. So you can own a thing but not own the thing. If I own something on trust for you, I can control it, but only in your best interests. If you own it on trust for me, I can benefit from the ownership, but without a lot of other legal effects that would normally ride shotgun with a full and undivided ownership. As usual: I am not a lawyer, this is not legal advice.