Read? Can recommend some high yield dividend stocks for passive income? (2)
When Uncle8888 said this:
"Any Tom, Dick, and Harry who has $X,XXX or $XX,XXX on Monday can immediately become an investor with high yield dividend stocks for passive income." - Createwealth8888
Some people read liao sibei buay song!!! They may think Uncle is talking cock!
Now, let us hear it from Sir John Templeton.
He is one of the most successful and best known professional investors of the past 100 years.
How to Increase Your Income from Investments
Memorandum to Clients February 15, 1954
Any good investment research man can prepare for you within a few minutes a well-diversified list of stocks yielding over 10 percent. On the basis of market prices on February 10th and the dividends paid in the last 12 months, Van Norman Company yields 10.5 percent, Moore-McCormack Lines 11 percent, Barker Brothers 11.7 percent, Pond Creek Pocahontas 11.9 percent, Butte Copper 12.3 percent, Nash-Kelvinator 12.8 percent, Pacific Tin 13.0 percent, Great Northern Iron Ore 13.0 percent, Inspiration Consolidated Copper 13.1 percent, and Roan Antelope Mines 15.6 percent. These are all well established corporations with shares listed on the New York Stock Exchange.
This is an easy method for increasing your income from investment; but it is the worst of all methods. Stocks sell at low prices in relation to current dividends usually because there are good reasons for expecting that the dividend may be reduced. Investors selecting stocks with high current yield face not only the risk of reduced dividends but also the greater risk of capital losses.
A far wiser method of increasing your income is to select stocks with the highest earnings in relation to market price. This will usually mean that your stocks have good prospects for paying increased dividends rather than prospects for paying reduced dividends. Many good stocks can now be found whose annual earnings are more than 15% of the market price.
Such earnings are partly reinvested by the company for the benefit of stockholders which, in turn, leads to still higher earning per share in future years. Of course, in seeking such stocks you should skip those whose earnings are high for one or two for abnormal reasons and search rather for those likely to have a high level of earning for many years in the future.
In the endeavour to increase your income, it is wise also to select growth stocks. Growth stocks are most likely to earn more and pay increased dividends in the future years. Usually growth companies have a higher rate of earning in relation to net worth. By retaining a large share of its earnings each year a growth company may be able to double its net assets per share within a relatively few years; and this in turn may lead to increased earning and dividends.
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Createwealth8888:
Read? How to become rich in stocks??? (10)
Two great investors have spoken on the importance of Retained Earning for future income growth.
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Whose words can you believe most???
Left or Right Bunny. The choice is yours!!!
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Hi CW8888,
ReplyDelete{Stocks sell at low prices in relation to current dividends usually because there are good reasons for expecting that the dividend may be reduced. Investors selecting stocks with high current yield face not only the risk of reduced dividends but also the greater risk of capital losses.}
Unquote:-
Everything being equal, the above maybe over-rule in an extreme bear markets. In fact it helps to select "better companies" during this shocking time which can still pay higher dividends than those companies that have reduced theirs.
In other words, it's one way to spot "solid" companies during extreme recession market. No?