My "value" portfolio

[ken-do-nim]

(11-02-2021, 06:32 PM)fenders53 Wrote:

(11-02-2021, 05:44 PM)Navi Wrote: I'm surprised that there is so much movement in a dividend portfolio. I expect dividend stocks to be purchased and held for many years unless they start to underperform (either stock price stays below the average for too long, or dividends get slashed). Also, these yields are quite high. I expect the long term dividend stocks to be around 3 or 4%. Is this a unique approach for you in regards to dividend investing?

DGI investing typically involves stocks with a yield under 3% these days.  That is actually much higher than SPY average yield.  There are exceptions but the growth part is typically diminished with higher yield stocks, and the total return is usually much less after a few years.  Most dividend portfolios with normal yields are lower beta than the SPY.  If memory serves .85 beta is pretty typical.  It normally shows up in a market crash.  Higher valuation growth stocks and high yielders get smoked compared to a conservative dividend growth portfolio.  It all looks good when the bull is running.  Terrible stocks are up 75% the past 18 months.  It's a rare time to be enjoyed.  The recent stats are fairly meaningless.

What's happening is that the high yielders are taking much longer to recover from the 2020 drop, so they are still rising back to their previous levels.  Let's take a look at OXLC.  It was on a gentle slope downwards prior to the drop, and now it is coming back to that level.  It will probably peak out at 9 or so before continuing this gentle downwards trend.