Total Return

[Dividend Watcher]

I think the problem is people see their way as the best. That's rational. However, many think because it's the best for them they are rude enough to tell you that you're wrong for not agreeing with them. I think DGI is best for me and is the only investment method that made logical sense to me of all the things I tried over the years. Therefore, it is psychologically easier for me to stay the course. Since this is the Dividend Growth Forum, that's the way I reply to posts.

I also think DGI can produce decent total returns. It's a matter of the choices you make. I would not consider investing in T for total return but having them pump 5ish% in dividends into my account every year sure does things for cash flow.

As I said to notexactly over in this this thread:

Quote:You have two things pushing up prices over time.

1. Increasing earnings: The type of companies we are talking about have the tendency to keep increasing their earnings. Sure they have slumps and rough periods. Some are internal causes and sometimes it's the economy, stupid. Sometimes it can take several years for a company to work out their internal problems but dividend growth companies do have the ability to bounce back. Afterall, the dividends have to be supported by their earnings. No one is going to let KO's price drop or stagnate to only 5x earnings without something catastrophic happening.
   
2. Increasing dividends: Like wise, as the dividend increases, yield will keep going up for a company with a stagnant stock price. You will never see JNJ yielding 10%. Someone will buy them out long before that happens.

I think dan's reasoning for investing in UNFI makes perfect sense for him at his age and where he is in the investing lifecycle. For me it holds no interest right now. Yet I invested in GILD for the same reason. I had a hunch a dividend was not in the too far future but there was no guarantee at the time. Ken, I agree. Price is much more uncertain than a seasoned dividend payer's payout.