It gapped down alot. There are investors who, before major news announcement, reduce their position to minimise risk. But you might also miss the tremendous opportunity.
I picked DIS because that's the stock that I was given. And it doesn't pay a very high dividend, 1.6%, that's not much for a blue chip. And most of the price appreciation happened since 2009 or 2011. Point is if you reinvest those dividends over a long period of time, you'll do great even if the price doesn't appreciate like Disney did. Or take an index. Apply dividend reinvestment to the S&P500. Sure, there will be stocks with no dividend that vastly outperform like Amazon, Facebook, or previously Google, but good luck finding them.
Down but not out. Long term up trend, lying on the floor of its channel and the nearest horizontal support. Buy the dip?
@Clubber Lang I'm with you on leaning more towards cap gains, some people just aren't like that though. They want the dividend income, and so buy a pseudo bond. You are perhaps being too negative on cashflow from capital vs growth of capital.
Said the guy who doesn’t even know the 16 Blue Chip Dividend companies I named. Good luck with your 20 year GE long. All it has to do is double from here and you’ll be close to break even!
Here is the answer to your question. I created a portfolio from 1/1/2008 until now using the portfolio you outlined. I started with a roughly equal distribution among those stocks. Each year, I used the dividends that were paid out to buy whichever stock from the group had the biggest losses. As you can see, it did slightly underperform the market. However, as far as dividend portfolios go, this portfolio is a bit unbalanced. You don't have any REITS, Utilities, and only a little bit of energy. This screenshot and backtest was generated using: https://www.smarterdividends.com