As from April 2013 my Journey in Investing is to create Retirement Income for Life till 85 years old in 2041 for two persons over market cycles of Bull and Bear.

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Welcome to Ministry of Wealth!

This blog is authored by an old multi-bagger blue chips stock picker uncle from HDB heartland!

"The market is not your mother. It consists of tough men and women who look for ways to take money away from you instead of pouring milk into your mouth." - Dr. Alexander Elder

"For the things we have to learn before we can do them, we learn by doing them." - Aristotle

It is here where I share with you how I did it! FREE Education in stock market wisdom.

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Important Notice and Attention: If you are looking for such ideas; here is the wrong blog to visit.

Value Investing
Dividend/Income Investing
Technical Analysis and Charting
Stock Tips

Wednesday, 23 June 2021

The Lifelong Joy Of Dividend Investing As One Source Of Retirement Income From A Freehold Investment Portfolio

Read? After Point X .....

After Point X, the joy of Panadol investing to ease heartache will transit into lifelong joy of Funadol investing as one source of retirement income on top of CPF in Singapore. Truly passive income! No?




8 comments:

  1. CW,

    Nothing is "bao jiak"... (as some long term investors have found out)

    Passive can be harmful to our pockets if its sleeping at the wheel...


    Regular dividends are a sign of healthy businesses except:

    1) When management is borrowing and using debt to maintain or increase the dividends.

    2) When dividends are paid out to yield hogs instead of reinvesting back to the business for future growth, R&D, etc...

    3) When the company is under challenge from new disruptors. ComfortDelgro and SPH anyone?


    Dividend GROWTH stocks where dividends GROW slowly every year are a better gauge of healthy businesses ;)

    ReplyDelete
  2. Hi Uncle8888 & Smol,

    "Dividend GROWTH stocks where dividends GROW slowly every year are a better gauge of healthy businesses"

    True .... but (there's always a but! LOL) many people won't go for it ... or won't stick with it for the long term, coz:

    1) current dividend yield tends to be low, often below 2%. Even during Covid crash the average yield of such companies maybe around 3%-4%.

    2) Hence, it's a loooooong-term thing, during which you'll have to sit thru -30% or -50% bear markets & recessions. The benefits only come after a couple of decades of holding & RE-INVESTING the dividends.

    3) These are usually value oriented stocks, so you WILL experience DECADES of losing out to even the broad index like S&P500, let alone growth stocks. Like from 2009-2021.

    But like I always say, in investing there isn't a yes or no thing. You can allocate a portion of your portfolio to such stocks or funds & test it out.

    S&P doesn't publish its list of Dividend Aristocrats or Dividend Achievers (they expect you to pay for it, cheap bastards). But you can see the constituents from info published by funds or ETFs investing in these companies.

    E.g. This is the portfolio of NOBL, an etf replicating the Dividend Aristocrats.

    Since the investing is done quantitatively by formula i.e. just follow index criteria, some dogs will be inside until they fail the criteria e.g. stop increasing dividends.

    For e.g. I view IBM as a current dog. Exxon & Chevron are also potential long-term challenged businesses unless they can pivot adroitly.

    But the vast majority are GOOD STUFF. ;)

    ReplyDelete
    Replies
    1. Spur,

      You think why I like to poke so called passive "investors" and yield hogs?

      Nothing is "bao jiak"!

      All investing strategies are "sound", in theory and with back-testing, but often we are our own worst enemies...

      We say one thing; do another thing altogether. Little lies we tell ourselves!


      On the other hand, fee-based and commissioned financial snake oils will be out of their jobs if they can't come up with a portfolio of dividend growth stocks (calling them Aristocrats is marketing spin genius) that can beat 1M65 hands down within a 30 years time horizon ;)

      Why bother otherwise?


      IBM is like SPH today. How the former greats have become mediocre...

      A good reminder long term investing is HARD!


      You think why I'm a trader?

      If I can't see beyond 6 months, what edge do I have when it comes to 30 years and beyond?

      LOL!

      Delete
  3. Cyclic stocks can be alternating between dividend-growth and dividend-reduction over economic cycles.

    ReplyDelete
    Replies
    1. CW,

      You have answered yourself.

      No one should practice Buy and Hold when it comes to CYCLICAL stocks ;)

      Shhh....

      Delete
  4. Actually almost stocks, sooner or later revert to mean value.

    The tricky or funny part are mean value can change as stock value by Market changing also.

    So which is easier?

    Estimating mean value or market's intrinsic value of a stock.

    Remember both can change like chameleon changing colours.

    LOL.

    ReplyDelete
  5. REITs and dividend stocks can crash 50% within a few months. 2008 financial crisis and 2020 Covid crash demonstrated that years of dividend income can be lost within a few months.

    Dividends as panadols is not effective when investment portfolio is savaged by a violent bear. If peace of mind matters a lot to the investor, then don't be too reliant on dividends and REIT income.

    ReplyDelete
  6. "Jiàn hǎo jiù shōu" is my style.

    Next Rinse & Repeat whenever possible.

    Alas!

    Such style, no 2 buggers, 3buggers, in fact no any buggers to show lah.

    And most of the time too much money rotting somewhere.

    Don't know how to max my capitals and assets - Not smart, so stupid lah.

    Except by default, my HP was on DRIP for donkey years and has spined of another 6 companies.

    ReplyDelete

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