Anonymous
If one can foresee S&P500 delivering 0% return over next 2 decades, would it be beneficial to invest in dividend plays instead?
Investing in growth companies or S&P500 has served investors well so far in past few years. But if one look at the S&p500 in the past century, there were several instances when the market delivered 0% returns.
Even Jack boggle says next few decades may see SP500 delivering only 4% annul returns. Do you see that market delivering much lower returns after a crazy decade of growth? If that happens, wouldn't it be much better to invest in dividend plays - guaranteed ~4% yield + ~2% annual growth?
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Depends on your stratergy. We can never know, remember to focus long term and not invest for the short term. Also, note that there are always people who are negative and bearish on the markets, if you want to find someone to quote, you can certainly find more than just a hand few every year. This isn't the first time yet people will always say "This time is different." Look long term if you are investing.
If you are trading, you can profit in any direction.
Dividends are not guranteed, it depends on the business revenue and performance. Dividends can be cut as evident this year.
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Chan Ze Ming
19 Oct 2020
Accountancy and Finance Student at Nanyang Polytechnic
Hello,
Depending on your investing horizon, its very difficult to get exactly 0% return unless the ...
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Dividends and growth are never guaranteed
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among the S&P500 stocks there are very many that pay dividends
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4% is nice
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there are no prophets