I always here about NAV decay blah blah but does it really matter? If you buy a rental property does it really matter if the market takes a dive and the apartment building loses half its value? No, as long as you are getting rent. With my high yield etfs I am down on capital but getting paid for it unlike my other non-dividend stocks. Even if your original investment was 100k, and you are getting 5k per month...if your capital drops to 20k you are still getting your 5k per month which in a year is 60k...in 10 years its 600k. You can't beat having a passive income.
My advice from long experience is that you will be better off focusing on total return of your invested dollars, as opposed to dividend income. Judge for yourself by comparing a broad-based ETF, such as SPY, to the total returns of your dividend ETFs. (Google: ETF total return calculator and/or Total Real Returns.) Long term, it is difficult to outperform buying the overall market, and peeling off capital gains. The appeal of dividends is like crack. It feels good but ultimately can be bad for your health.
Very difficult to believe you are not joking. Seriously, only income matters, not the value of the underlying asset? If you subscribe to that, nothing more need be said. You apparently will learn your lessons from the real-world. Why do you even spend time on this site -- or any other financial site?
Another clueless trader who thinks that just because he signed up for this site makes him Elite. I have proven time and time again that I am more directionally saavy than any of you LOL. Like you have a clue where price could be in a month on whatever you're trading . So you will blindly get stopped out and wonder why while the cycle continues. "Unrealized losses are no more losses than unrealized gains are gains." I was up huge a few weeks ago but do you think I "took profits" lol?? Heck no..I didn't even notice cuz I was too busy flight simming. I probably could have bought an actual plane but who cares! Keep the dividend coming
hold 100k and get 5k a month hold 20k and get 5k a month makes sense. no matter what you hold you get 5k a month
Problem is that the dividends fluctuate. If you look at BITO which wxy holds the dividend has gone from 1.76 last june to 0.72 last month. If or rather when they cut a dividend the price of the underlying will plummet.
I suppose if you live another 30-40 years your system might work. But if you drop dead tomorrow and all your net worth assets have to be liquidated your family might be in a bad way and very upset with you.
Did it ever occurred to you while the property value dropped the rent usually went up? You're getting 5% of the principle EVERY SINGLE MONTH? First of all, name this ETF. Second, if this is what you claim to be, it's gotta be junk bonds and they have a strong track record of blowing up in the long run. There's no friggin' way they'll be distributing 5% every single month for 10 years. As I've always said, you blow too much smoke out of your ass.
You have discovered the holy grail of investments. In prior posts you mentioned BDCs. You forecast 10 years of dividends payments. Is there NO SCANARIO where payment drops to zero and the investment value drops to near zero.
dude there is no total return on investment - that is a lie and a myth. if you trade stocks, it's all a ponzi scheme. nothing traded is profitable as stand alone, it's just musical chairs and investors refuse to see the truth. they are all blinded for the lust of the unearned and that is why investors are the cannon fodder for real traders who understand this. investors just stick their dick in it, traders move it in and out..