I started serious Investing Journey in Jan 2000 to create wealth through long-term investing and short-term trading; but as from April 2013 my Journey in Investing has changed to create Retirement Income for Life till 85 years old in 2041 for two persons over market cycles of Bull and Bear.

Since 2017 after retiring from full-time job as employee; I am moving towards Investing Nirvana - Freehold Investment Income for Life investing strategy where 100% of investment income from portfolio investment is cashed out to support household expenses i.e. not a single cent of re-investing!

It is 57% (2017 to Aug 2022) to the Land of Investing Nirvana - Freehold Income for Life!

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Thursday, 6 October 2011

Pillow Stocks Strategy (2)

Read? Pillow Stocks Strategy

What will make an investor feel most comfortable with his investment?

  • Firstly, Return of Capital.
  • Secondly, Good Yield.
  • Lastly, Capital appreciation.
That is the reason why many investors will jump into bonds or perference shares when yield are good and when they become available in the market.

Dividend Investing Strategy

A 10% dividend yield stock will return you your capital in 10 years; and thereafter let you enjoy good yield and capital appreciation

Pillow Stock Strategy

If you believe that dividend investing strategy will work for you; but you may feel that 10 years is just too long to wait. Then think Pillow Stock Strategy. It will help you to:

  • Firstly, Return of Capital.
  • Secondly, Good Yield.
  • Lastly, Capital appreciation.
"Pillow stocks are the best stocks to hold over market cycles." - Createwealth8888


Posted by Createwealth8888 at 21:11
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7 comments:

  1. Anonymous7 October 2011 at 23:47:00 GMT+8

    Dear CW8888,

    Using a 10% dividend yield and assuming all dividends are reinvested, it will actually take about 7+ years to double the initial investment (using the rule of 72).

    This is without considering that the share price may increase over time, or that the dividend yield (as a dollar amount) may increase over time as well.

    All in all, should this be a real 'pillow stock strategy', folks should be smiling in their sleep knowing that their $X investment today would grow to $2X in just about 7 years, haha.

    Time in the market + good fundamentals = wealth.

    ReplyDelete
  2. Createwealth88888 October 2011 at 00:14:00 GMT+8

    Actually, it is very harder to reinvest dividends received at the same yield e.g. 10% in this case so realistically it will take more than 7+ yrs to double the initial investment.

    Sometime, reinvestment will have risks and may also fail. That is the truth in investing and re-investing, nothing is certain.

    ReplyDelete
  3. Anonymous8 October 2011 at 09:07:00 GMT+8

    Hi
    Me think any stock/bond that gives you 10% yield is not sustainable. i don't think you can find any historical chart of this kind of stock/bond.
    Why? Because we all would love it very much. Maybe in the years where inflation were more than 10 %. But i still doubt it can be sustainable?

    ReplyDelete
  4. Createwealth88888 October 2011 at 11:40:00 GMT+8

    It may be possible with growth-dividend stocks at the future Big Bear markets :-)

    ReplyDelete
  5. Ah John8 October 2011 at 21:26:00 GMT+8

    Just need to be patient.

    ReplyDelete
  6. Unknown6 January 2012 at 15:21:00 GMT+8

    I dun think such stocks exist in our SGX. 10% dividend yield for 10 years? Absolutely no, as least not in SGX.

    Regards,
    SG Web Reviews
    www.sgwebreviews.blogspot.com

    ReplyDelete
  7. Investopenly21 July 2014 at 12:48:00 GMT+8

    It's never too late to learn about your Pillow Stock Strategy ;-)

    ReplyDelete

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