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When I invest it’s usually because I think “I like this dividend yield.” I can buy, forget and auto-reinvest the dividends. Stock price swings are not particul

When I invest it’s usually because I think “I like this dividend yield.” I can buy, forget and auto-reinvest the dividends. Stock price swings are not particularly interesting if you never plan to sell.

peteretep 7y ago
Do you think the market ignores the yield when pricing assets?
speedplane 7y ago
> When I invest it’s usually because I think “I like this dividend yield.” That's a pretty sophomoric way to look at investing. Many companies provide no dividends. Many give large dividends, but their stock value decreases. Obviously, when considering an investment, one considers both the dividends and potential growth of the underlying asset together.
- erpellan 7y ago
  Boring. The word is boring. Boring companies whose stock prices do nothing for 30 years but gently drift up and down with the market (or not), steadily yielding 5% dividends year after year. Usually they sell things like toilet paper, soap, electricity or other boring everyday things. When it comes to long term investing, boring is good.
  - conistonwater 7y ago
    This analysis is definitely wrong, it's discussed in textbooks too. You need to seriously, properly consider the risk of the investment, and if your model of the stock price is that it gently drifts with the market while yielding 5%, then that's just wishful thinking on your part.
  - speedplane 7y ago
    > Boring companies whose stock prices do nothing for 30 years but gently drift up and down with the market (or not), steadily yielding 5% dividends year after year. ... When it comes to long term investing, boring is good. The S&P 500 has pretty consistently had yields of 10-15% over the last 100 years. It makes more sense to invest in a "boring" ETF that follows the market making 10% than a "boring" stock that yields 5%.
- saaaaaam 7y ago
  In this specific situation one of the clearly stated aims of Hipgnosis is to return income through dividends. https://www.hipgnosissongs.com/investment-objective-and-policy https://www.hipgnosissongs.com/investment-objective-and-poli...

peteretep 7y ago

Do you think the market ignores the yield when pricing assets?

speedplane 7y ago

> When I invest it’s usually because I think “I like this dividend yield.” That's a pretty sophomoric way to look at investing. Many companies provide no dividends. Many give large dividends, but their stock value decreases. Obviously, when considering an investment, one considers both the dividends and potential growth of the underlying asset together.

erpellan 7y ago
Boring. The word is boring. Boring companies whose stock prices do nothing for 30 years but gently drift up and down with the market (or not), steadily yielding 5% dividends year after year. Usually they sell things like toilet paper, soap, electricity or other boring everyday things. When it comes to long term investing, boring is good.
- conistonwater 7y ago
  This analysis is definitely wrong, it's discussed in textbooks too. You need to seriously, properly consider the risk of the investment, and if your model of the stock price is that it gently drifts with the market while yielding 5%, then that's just wishful thinking on your part.
- speedplane 7y ago
  > Boring companies whose stock prices do nothing for 30 years but gently drift up and down with the market (or not), steadily yielding 5% dividends year after year. ... When it comes to long term investing, boring is good. The S&P 500 has pretty consistently had yields of 10-15% over the last 100 years. It makes more sense to invest in a "boring" ETF that follows the market making 10% than a "boring" stock that yields 5%.
saaaaaam 7y ago
In this specific situation one of the clearly stated aims of Hipgnosis is to return income through dividends. https://www.hipgnosissongs.com/investment-objective-and-policy https://www.hipgnosissongs.com/investment-objective-and-poli...