Does dividend investing pay off?

Discussion in 'Stock Market Today' started by ALAN YONEDA, May 7, 2021.

  1. ALAN YONEDA

    ALAN YONEDA New Member

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    If I buy 400 shares of Verizon at $58 per share and they pay an annual dividend of $2.51 per share and I reinvest all the dividends it would take 20 years just to break even. Why would anyone dividend invest if this is the case? It seems pointless. Am I missing somthing here?
     
  2. StockJock-e

    StockJock-e Brew Master
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    If you have $23,000 in the bank doing nothing, it earns 1%.

    If you have $23,000 invested VZ, it earns 4.25%.

    You are getting paid to hold a stock that is also going up in value (assuming business is good).
     
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  3. ALAN YONEDA

    ALAN YONEDA New Member

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    Thanks for your reply. That makes sense. Im a new investor and I guess I had unrealistic expectations. Hopefully the stock appreciates to provide some sort of a turbo boost.
     
  4. Bridget Mallory

    Bridget Mallory Active Member

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    Makes sense
     
  5. TH Analysis

    TH Analysis Member

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    you may need to adjust for inflation, tax and commissions.
     
  6. T0rm3nted

    T0rm3nted Moderator
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    The first two maybe, but commissions in 2021 are basically not a thing.
     
  7. Stonksalltheway

    Stonksalltheway New Member

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    Yes dividend stocks investing is worthwhile in the long run, especially for non-savvy consumers like us, who can probably beat the market better than those “experts” stock traders / investors you see on TV and read on the internet.

    Go for dividend ETFs or the S&P500 ETF.

    Dividend ETFs work on averaging out, and you are paying very little fees compared to mutual funds or unit trusts. Analyzing stocks is extremely time consuming and you are also not sure who are the real experts. There are various stockbrokers or stock analysis pages with their own agendas. Asking these experts for advice is like asking a barber whether you need a hair cut.

    You would be much better off buying that dividend ETF. Those are done by professionals who understand the key to rich dividends is low management fees, low charges and spreading out the funds with a well diversified basket of healthy stocks.

    If you do not need the cash flow till retirement, set up a Dividend ReInvestment Plan (DRIP) for your stocks so that all dividends automatically buy more stock, even fractional shares. And stick to your regular contribution from your paycheck and eventually by retirement, you will see a healthy portfolio.

    I for one have been very reluctant to learn about blockchain and the market luckily I have seen how it simply affected the stock market, take BTCS for example. They are a blockchain technology focused company, which has announced that The Nasdaq Stock Market LLC has approved the listing of the Company’ common stock on The Nasdaq Capital Market (“Nasdaq”). The Company’s common stock which began trading on Nasdaq under trading symbol “BTCS” at the open of the market on Tuesday, September 14, 2021.

    BTCS joins Nasdaq at a time when the digital asset market has reclaimed a total market capitalization of greater than $2 trillion. The Company generated $453 thousand in revenue for the first six months of 2021 and through timely purchases of Bitcoin, Ethereum, and other cryptocurrencies, BTCS has substantially grown its digital assets over the last year. But that’s just me.
     
  8. ddebrazza

    ddebrazza Active Member

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    Yes, I love Dividend stocks. They reflect a profitable company.

    Abbott Labs (ABT) is a good Dividend-paying stock with lots of upside, IMO. The dividend this year was only .50 but it is something.
     

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