Posts Tagged Dividend Payments

Let’s patiently watch to see if this rally actually finds its footing or if it is another false start. On another note, clients may wonder why I email them every little dividend payment? It’s because they add up! Buttonwoods noted in the Economist this week that, “DIVIDENDS do not get the respect they deserve. Over the long run they provide the bulk of equity investors’ returns. Work by Elroy Dimson, Paul Marsh and Mike Staunton of the London Business School* found that over the period from 1900 to 2005, the real return from global equities averaged 5%. The mean dividend yield over that period was 4.5%.  Despite this, stockmarkets devote a lot more time to forecasting and analysing profits than they do to thinking about payouts. Profits can be easily manipulated and come in a bewildering variety of forms (operating, reported, post-tax, pre-exceptional, etc). Dividends are (mostly) paid in cash and so are hard to fake. ”

I agree.

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