10-18-2020, 09:51 AM
And when is this "at some point".
If the plan is to move to this allocation in 10-20 years, then I think it's fairly pointless to make any sort of lists as to what you want to buy. You are targeting high yield, super high yield in a lot of these cases. Half of those companies/funds won't be around or they will have lowered their dividend at some point along the way. Every single one of those companies will look different than it looks today.
Interest rates change. Things such as taxes change. Rules regarding share buybacks could change. Probably all of these, and many other things that we can't predict, will happen in the next 10 to 20 years. This is why I also think it's pointless to spend time thinking about what sort of yield you want and drawing up these yield bracket thingies etc. The idea itself is ok, but those numbers too will change along the way as the world changes around them.
If you aren't planning on switching to this allocation in the next few months, then it's probably best to to focus more on the concept rather than on the details. But concepts change too. 10 years ago a high yield income generating portfolio might have had 30% of bonds in it.
If the plan is to move to this allocation in 10-20 years, then I think it's fairly pointless to make any sort of lists as to what you want to buy. You are targeting high yield, super high yield in a lot of these cases. Half of those companies/funds won't be around or they will have lowered their dividend at some point along the way. Every single one of those companies will look different than it looks today.
Interest rates change. Things such as taxes change. Rules regarding share buybacks could change. Probably all of these, and many other things that we can't predict, will happen in the next 10 to 20 years. This is why I also think it's pointless to spend time thinking about what sort of yield you want and drawing up these yield bracket thingies etc. The idea itself is ok, but those numbers too will change along the way as the world changes around them.
If you aren't planning on switching to this allocation in the next few months, then it's probably best to to focus more on the concept rather than on the details. But concepts change too. 10 years ago a high yield income generating portfolio might have had 30% of bonds in it.