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Old 05-27-2021, 07:53 AM   #141
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Originally Posted by ERD50 View Post
That's not a very nice thing to say.

A lot of data, information and work was contributed to this thread by a number of posters. But you say the ONLY thing to happen was to "beat up" the OP?

If the data shows a claim to be wrong, then it raises doubts about that claim. Isn't that worth shining some light on?

Where is the "beating"? I think you owe this thread an apology.

OK, there was an early "sigh" response, that could come across as dismissive, and maybe rude. But if you have seen how many times the div-payers have posted the supposed virtues of these investments, and ignore the data without providing any of their own, you might find it understandable (restrained even!).

And what the heck is a "MEGA Poster"?

-ERD50
MEGA reference I could do without.
However, this infatuation with very limited data as being the "settled science" is absurd. Maybe that is what is being referred to as "beat up".

Things like using very limited data to make comparisons that no one is advocating for except the person using the very limited data.
The term is strawman argument. Maybe that is what is being referred to as "beat up".

Other than that, I believe we are all adults here and can live without the apology that you believe is owed.
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Old 05-27-2021, 09:16 AM   #142
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Originally Posted by olyveoil View Post
False comparison. Stop asking people to not insert words when no one is inserting words. You made the comparisons.....question is, why? AS they are not relevant to what is being proposed.
I did explain why the comparison is relevant. The div-sector funds under-performed, and when the total market was adjusted with a bond mix to bring the std dev down to the div-sector, that blend still outperformed the div sector. There is no evidence (in that time frame, which is all we have for available div-sector funds/ETFs)), that the div-sector brings anything to the party, regardless of what % of the portfolio it makes up. A drag on performance is a drag on performance.

Bonds, while under-performing, do bring something to the party - lower volatility.


So, can you please show us some data that shows the div sector will help boost a portfolio? If you think my data is irrelevant, it might be interesting to see some data from you that you consider relevant.

-ERD50
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Old 05-27-2021, 09:17 AM   #143
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Originally Posted by ERD50 View Post
That's not a very nice thing to say.

And what the heck is a "MAGA Poster"?

-ERD50
Sometimes the truth HURTS....OP was not asking for input other than asking for a couple of Dividend ETF and a lot of PPL starting telling him how BAD of idea it was.

As far as the MEGA I am sorry it should have been spelled MEGA... [mod note - MEGA reference edited
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Old 05-27-2021, 09:34 AM   #144
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[mod note] MEGA reference corrected in all the posts to avoid confusion
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Old 05-27-2021, 10:03 AM   #145
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Originally Posted by ERD50 View Post
I did explain why the comparison is relevant. The div-sector funds under-performed, and when the total market was adjusted with a bond mix to bring the std dev down to the div-sector, that blend still outperformed the div sector. There is no evidence (in that time frame, which is all we have for available div-sector funds/ETFs)), that the div-sector brings anything to the party, regardless of what % of the portfolio it makes up. A drag on performance is a drag on performance.

Bonds, while under-performing, do bring something to the party - lower volatility.


So, can you please show us some data that shows the div sector will help boost a portfolio? If you think my data is irrelevant, it might be interesting to see some data from you that you consider relevant.

-ERD50
You explained it to yourself after you created a strawman to knock down.
And the best part? You keep doing it.
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Old 05-27-2021, 10:40 AM   #146
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I found this chart on the Schwab website illustrating their ThomasPartners Strategies managed portfolio. It doesnít compare to VTI, but to an S&P total return benchmark and a NASDAQ benchmark. Itís net of their fees. Only the recent years put the S&P fund ahead.

IMG_3439.JPG
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Old 05-27-2021, 04:22 PM   #147
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Originally Posted by ERD50 View Post
I did explain why the comparison is relevant. The div-sector funds under-performed, and when the total market was adjusted with a bond mix to bring the std dev down to the div-sector, that blend still outperformed the div sector. There is no evidence (in that time frame, which is all we have for available div-sector funds/ETFs)), that the div-sector brings anything to the party, regardless of what % of the portfolio it makes up. A drag on performance is a drag on performance.

Bonds, while under-performing, do bring something to the party - lower volatility.


So, can you please show us some data that shows the div sector will help boost a portfolio? If you think my data is irrelevant, it might be interesting to see some data from you that you consider relevant.

-ERD50
Since unsuccessful funds get closed/merged, the lack of high dividend funds with a long history that anyone has been able to find so far seems like a clue to how successful this strategy is.
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Old 05-27-2021, 04:35 PM   #148
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Since unsuccessful funds get closed/merged, the lack of high dividend funds with a long history that anyone has been able to find so far seems like a clue to how successful this strategy is.
ROFL. Excellent point. S&P SPIVA folks have a graveyard of all deceased funds. It would be fun to poke around in there. CRSP database would be good too. All we need is some graduate student looking for a thesis topic.

I think the fact that the strategy systematically de-emphasizes the companies with the highest potential is a pretty good clue too. Small, Growth, Value, stock buyback-ers, etc. Decades of history and academic analysis support small and value as winning tilts, then a dividend buyer tilts away. Growth in the last decade or so has been a winner and the dividend buyer tilts away. Dividend buyer also ignores companies taking the tax-efficient buyback strategy. It just seems like a strategy calculated with the objective of reducing total return.
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Old 05-27-2021, 06:20 PM   #149
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There is more than one pyromaniac in a field of strawmen on this thread.
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Old 05-27-2021, 06:29 PM   #150
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Originally Posted by ERD50 View Post
I did another run to get more data, an old Vanguard 500 fund, and the investor version of VIGAX (VIGRX), and I included the 3.5% inflation adjusted w/d.

VIGRX pulls out at the end, but seemed behind most of the time, trading places occasionally.

https://bit.ly/3wDodji

It would be interesting to me to see a strict computer generated (passive management) "VTI minus the high div payers" fund. With the proper resources, it could be constructed in the rear view mirror for analysis. At a glance of the holdings, VIGRX isn't excluding div payers in the major holdings (though those divs are low, HD the highest at ~ 2% ?), it's actively managed to look for growth.

-ERD50
I think you could simulate that with 100% VTI, -x% VIGRX and +x% CASH.
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Old 05-27-2021, 07:29 PM   #151
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Originally Posted by Exchme View Post
Since unsuccessful funds get closed/merged, the lack of high dividend funds with a long history that anyone has been able to find so far seems like a clue to how successful this strategy is.
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ROFL. Excellent point. ...
Yes, good point. Hadn't thought of that angle. Might be another Occam's Razor explanation?


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Originally Posted by pb4uski View Post
I think you could simulate that with 100% VTI, -x% VIGRX and +x% CASH.
Yes, but VIGRX (as I understand it) is an actively managed fund. Their selections would seem to downplay the types of div-payers that those people are looking for, but isn't a strict inverse of the high-div-sector.

Might be an interesting exercise, just not sure that much could be drawn from it.

-ERD50
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Old 05-27-2021, 07:41 PM   #152
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Originally Posted by olyveoil View Post
There is more than one pyromaniac in a field of strawmen on this thread.
Why make innuendoes? If you have a strong argument about something state it
plainly and politely. Otherwise your posts come across as combative and unhelpful to the thread topic.
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Old 05-27-2021, 07:51 PM   #153
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Old 05-28-2021, 03:06 AM   #154
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olyveoil,

I don't come to this website very often anymore for the same reasons that you are now discovering. Its pointless to try and have a discussion on here about dividend investing. Don't waste your time.

P.S. Take a look at the etf DIVO. Its become one of my favorites.

It aims to generate 2%-3% from dividends and another 2%-4% from covered calls.

It invests in blue chip S&P 100 companies.

It buys companies for dividend growth, not yield. Tries to get 10%-15% dividend growth per year on avg over 5 year periods.

It uses covered calls primarily for risk mitigation. Tries to capture 80%-90% of the upside compared to the S&P 500, while trying to limit downside to 65%-75% compared to the S&P 500.

It pays monthly.

P.P.S. For quarterly income I like SCHD and SCHY.
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Old 05-28-2021, 04:59 AM   #155
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SCHY - Dow Jones International Dividend 100 Index

https://www.indexologyblog.com/2021/...-index-part-1/

that's a new ETF to consider.
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Old 05-28-2021, 07:03 AM   #156
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olyveoil,

I don't come to this website very often anymore for the same reasons that you are now discovering. Its pointless to try and have a discussion on here about dividend investing. Don't waste your time.

P.S. Take a look at the etf DIVO. Its become one of my favorites.

It aims to generate 2%-3% from dividends and another 2%-4% from covered calls.

It invests in blue chip S&P 100 companies.

It buys companies for dividend growth, not yield. Tries to get 10%-15% dividend growth per year on avg over 5 year periods.

It uses covered calls primarily for risk mitigation. Tries to capture 80%-90% of the upside compared to the S&P 500, while trying to limit downside to 65%-75% compared to the S&P 500.

It pays monthly.

P.P.S. For quarterly income I like SCHD and SCHY.
Did some testing in Portfolio Visualizer-
The DIVO fund is fours years old with a CAGR of 11.1% vs VTI at 14.3% over that period (assuming 4% withdrawal). So chasing dividends was a big loser on total returns. However, DIVO did a little better in the downturns in that period, so if we pretend that four years is statistically significant, at, search for the efficient frontier, at say, 15% standard deviation, would be 26% DIVO/ 74% VTI. Seemingly an improvement? However, if offered BND as well, DIVO falls off the efficient frontier entirely. At the 15% SD, the program wants 91% VTI/9% BND for instance. Not a surprise since the cross correlation between VTI and DIVO was r=0.94, so hard to use it as a diversifier.

The previous suggestion for a high dividend index was VYM, with data going back to 2007, capturing the financial crisis. Over the duration, the high dividend offering is not on the efficient frontier at all, just different mixes of VTI+BND. There are a very few subsets of time where VYM is on the efficient frontier at all.

So invest how you want and enjoy life, but I don't see any data discussed in this thread that shows chasing dividends adds value.
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Old 05-28-2021, 07:31 AM   #157
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A few comments.

All these historical data points, graphs, and so on is an illusion. People do not get the benchmark returns even if they put 100% into the most holly of hollies VTI (or VT depending on how well intl is doing) (or a small cap value tilt, depending on how well that is doing, because I have seen a lot of hypocrites over the years in the "everything must be VTI crowd").

I have said this many many many times on this message board, and I will say it again. Investing for dividends is a withdrawal strategy. The core concept is that you are relying on dividend income for your withdrawals. You can do this with almost anything. You can apply this strategy with VTI, VT, even QQQ pays a dividend.

This is why people cannot have a productive discussion about dividend investing. The dividend investor is choosing a withdrawal strategy, the "VTI or else" crowd is talking about a stock selection strategy.

When dividend investors advocate dividend investing it is because of the withdrawal method. The actual stock selection is secondary and unique to each individual. It is not monolithic such as "put it all into VTI or you suck".

People that attack dividend investing by making stock selection comparison completely miss the point of dividend investing which is a WITHDRAWAL STRATEGY.

The correct comparison to make is dividend investing vs the 4% rule, for example.
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Old 05-28-2021, 07:39 AM   #158
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... The correct comparison to make is dividend investing vs the 4% rule, for example.
Only problem is that investing and withdrawal stratagies are two different animals and your presumtion that dividend investing is a withdrawal strategy is totally goofy... and thus so is your conclusion.

Now that said, from the data I have seen the results of dividend investing and total return investing are not so different as to get upset about... in very few cases will using dividend investing vs total return cause ruin.
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Old 05-28-2021, 07:54 AM   #159
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Only problem is that investing and withdrawal stratagies are two different animals and your presumtion that dividend investing is a withdrawal strategy is totally goofy... and thus so is your conclusion.

Now that said, from the data I have seen the results of dividend investing and total return investing are not so different as to get upset about... in very few cases will using dividend investing vs total return cause ruin.

When the last crash happened I was calm, unlike in 2008 when I was stressed to the max.

The difference was that I learned from the 2008 crash that relying on total return is too stressful. That is when I turned to dividend growth investing.

Many people on this message board panicked in 2020 and sold out and then had to try and market time getting back in, and lost a lot of money (or at least opportunity cost).

The dividend withdrawal strategy has served me very well.
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Old 05-28-2021, 08:02 AM   #160
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When the last crash happened I was calm, unlike in 2008 when I was stressed to the max.

The difference was that I learned from the 2008 crash that relying on total return is too stressful. That is when I turned to dividend growth investing. ...
The only problem with that logic is that the drawdown rates between VTI and high dividend funds are not very different during periods of financial stress.... so while you say that a dividend strategy served you very well a total return strategy would have also served you very well.
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