How much do dividend paying stocks pay?
- Thread starter Magaya
- Start date
It all depends. You could make money even if you purchase it for one day. Obviously the more stocks you have, the bigger your revenue would be if they rise. But you also risk the chance of losing more. But that's pretty much the game of the stock market. I bought BMO at around 44 dollars a share and sold it at 59.65 I believe. Made 1500+ off it.
I had Talisman a long time back too, I forgot how much I made out of it. I had it for a few months maybe.
I had Talisman a long time back too, I forgot how much I made out of it. I had it for a few months maybe.
Talisman's current annual dividend per share is 27 cents. Holding 100 shares for one year gives
you $27. The dividend is paid on a half-yearly basis I believe. Technically you only need to
be the owner of the stocks for the two record dates to get paid.
Typically dividend yield of most blue chip stocks fall in the 2--4% range.
you $27. The dividend is paid on a half-yearly basis I believe. Technically you only need to
be the owner of the stocks for the two record dates to get paid.
Typically dividend yield of most blue chip stocks fall in the 2--4% range.
Thanks a lot for letting me know.
I guess it is better to concentrate on the yield of stock rather than dividend which is peanuts anyways.
The yield is the annual dividend divided by the current price.
So it is your expected annual return from the dividend.
You say that is peanuts, however
1. If you can find companies that have a history of increasing the dividend (JNJ, CNR , the Canadian Banks etc), you may expect that trend to continue.
If you buy and hold the stock for many years and the company regularly increase their dividend, then your dividend return is much higher than the stated yield (ie yield on cost)
2.An increased dividend makes that stock more attractive resulting in the price being bid up (generally)
3. Studies have shown that dividends are responsible for a very significant portion of long term returns
http://www.tweedy.com/resources/library_docs/papers/highdiv_research.pdf
I believe another study indicate the yield was responsible for almost 1/2 of the long term equity return in the 20th century.
Finally
Do not get caught in a dividend trap of buying based on the high yield alone
A very high yield (> 5% ) may indicate the market does not think the dividend payout is sustainable
Yellow media YLO was sporting a high yield for a while, but I believe they had to cut the payout and they will need restructuring (or bankruptcy)
Print media competing against the Internet?
When was the last time you used the Yellow pages ? 1999 ?
Some REITs pay good quarterly dividend. I agree with John, good divided payout increases stock value and is a long term retun strategy.
Check out SOT.UN, INN.UN. I am happy with them.
Check out SOT.UN, INN.UN. I am happy with them.
Sure...if it fits your "risk appetite". Also, depends if you have portfolio and how you intend to balance. Quick slash n run is more risky. Remember...you don't enter the market to win...you enter to minimize your losses. Each to its own!
In the current investing environment I'll focus on income
stability rather than making quick bucks.
A portfolio of income stocks comprising mainly ex-income-trusts
turned corporations and REITs could still give you a yield better than
the typical blue chip dividend stocks. Absent a repeat of the
2008 crash for a well diversified and balanced portfolio
of income stocks a yield of 6--7% is hopefully sustainable.
Thanks for your post, I found it very helpful. I'm wondering if that also applies to the banks as well? Right now, both CIBC and BMO have a yield of around 5.7%, do you think that's sustainable? The other three seem to hover between 3.5% and 4.5%, is that more in line with future expectations for BMO and CM?
Also, SunLife Financial seems to be the poster child for caution on chasing yield alone - the yield for SLF is over 9% right now, and there's no way they'll be able to keep that up with interest rates as low as they are. Thanks for the link to that report, I found it very informative.
Life right now is so complicated. Many Canadians feel we can live sheltered from the battered global economies, but I'm not sure we can sustain our high real estate prices and our rosie economic forcasts. I believe today the BoC announced a decline in forcasted growth for 2012. The decline of Europe would seem to be a foregone conclusion. The U.S economy is going to continue to sputter at best. I believe our bank stock prices have priced in some of the economic doom and gloom but not all of it. SunLife is down from $34.00 to $23 and thus the yield has increased, but they are one of the big insurers that have sold billions of guaranteed investment funds and are dependent upon rising stock prices or will continue to have build reserves to cover all those guaranteed segregated funds. Manulife is probably on the hook for the most guaranteed segfunds and that's why owning Manulife stock has become a play on the TSX.Thanks for your post, I found it very helpful. I'm wondering if that also applies to the banks as well? Right now, both CIBC and BMO have a yield of around 5.7%, do you think that's sustainable? The other three seem to hover between 3.5% and 4.5%, is that more in line with future expectations for BMO and CM?
Also, SunLife Financial seems to be the poster child for caution on chasing yield alone - the yield for SLF is over 9% right now, and there's no way they'll be able to keep that up with interest rates as low as they are. Thanks for the link to that report, I found it very informative.
The only real good advice is to diversify and owning Sunlife today is a far better play than buying it at $34 so WHY NOT??..and you get paid 9% to wait? that's great. I believe the earnings yield is actually 14% right now so($3.50 earnins per share on $23 stock price)..so the dividend yield isn't too adventurous. Owning most stocks today is better than buying them at any time over the last 10 years. Bonds have no yield, and have no where to go but lose. It might not happen for 5-6 years but eventually the bubble in the bond market will deflate(or burst)
Gotta love Gold Stocks too. G, K, YRI, etc etc.
And what happens when it goes down again the next day..and the next? Slash n run is a greater risk than buying blue chip dividend paying stocks, many of which have DRIPs, IMO.
