12-11-2017, 06:43 AM
OK, time for a final update:
Some time ago I decided to give up picking individual stocks and change to as neutral as possible index investing. My whole portfolio consists now of a few market weighted ETF's covering the global investable market with lowest possible fees. With a quick glance I counted that among my index funds familiar big DGI stocks make up for at least 25% of the whole portfolio, or approx. 33% of the developed world large caps. On top of that number there names like Berkshire, General Electric, Amazon, Alphabet, Facebook, so the ingredients are not that different.
The main reason for this decision was that getting dividends from stocks makes no sense in my country, where an accumulating ETF or fund is free from income tax (other than withholding inside the fund). The other reason was that although I was doing fine, so were passive index funds with no work required. I had thought that I could run a portfolio without investing too much time in to it, but realized I was understating the effort it took and ended up basically wasting my hours when index funds were available all the time.
I don't think dividend growth is a bad approach, in fact it still feels rational and one the best ways to look at the stock market. I'm still drawn to the attempt of beating the market with stock picking and passive income, but in the end the tax problem was too much to ignore. I just want to thank everyone for this forum, although DGI was not optimal for me it was certainly a great learning experience leaving me with a more mature view on investing in general. Goodbye!
Some time ago I decided to give up picking individual stocks and change to as neutral as possible index investing. My whole portfolio consists now of a few market weighted ETF's covering the global investable market with lowest possible fees. With a quick glance I counted that among my index funds familiar big DGI stocks make up for at least 25% of the whole portfolio, or approx. 33% of the developed world large caps. On top of that number there names like Berkshire, General Electric, Amazon, Alphabet, Facebook, so the ingredients are not that different.
The main reason for this decision was that getting dividends from stocks makes no sense in my country, where an accumulating ETF or fund is free from income tax (other than withholding inside the fund). The other reason was that although I was doing fine, so were passive index funds with no work required. I had thought that I could run a portfolio without investing too much time in to it, but realized I was understating the effort it took and ended up basically wasting my hours when index funds were available all the time.
I don't think dividend growth is a bad approach, in fact it still feels rational and one the best ways to look at the stock market. I'm still drawn to the attempt of beating the market with stock picking and passive income, but in the end the tax problem was too much to ignore. I just want to thank everyone for this forum, although DGI was not optimal for me it was certainly a great learning experience leaving me with a more mature view on investing in general. Goodbye!