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.
     

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