This has been my experience since 2000. Market crashed and so did the value of my portfolio. My dividend income went up. Market started to recover and so did my portfolio. My dividend income went up. The market again crashed in 2008 and so did the value of my portfolio. My dividend income went up. The market recovered from 2008 and so did the value of my portfolio. My dividend income went up.
Since 2000 my income has increased by 109%. The median increase of my income is 7.8% per year. I still had interest bearing financial vehicles in 2000, so just looking at dividend increases only does not tell the whole story. (By the way my median dividend increase since 2000 was 11.5% per year.) My 5 and 10 year median dividend growth is 9.6% and 11.5% per year to the end of 2012.
I sort of practice buy and hold in order to have a portfolio producing dividends for me live off of. I have had no salary since I stopped working in 1999, so any purchases of stocks was using money from my portfolio income or because of a sale of a currently owned stock. I do some buying and selling.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my site for an index to these blog entries and for stocks followed. Follow me on Twitter.
Dividend income is an important part of your total return when you invest in common stocks. Rising stock prices help to build your wealth and beat inflation, but dividends provide a steady return on your investment through thick and thin and add up faster than you think.
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It will be nice to read about your buying and selling. Like have you ever buy a stock only to sell it later and only to profit from capital gain. Are you at any point a trader? I would like to know.
ReplyDeleteYes, I do do some buying and selling and I will try to address that shortly.
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