RE: Living Off Your Yield Instead Of Your Principle
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I've been thinking of investing in some high dividend yield stocks. Like tobacco which has a "sinful" reputation despite being legal, and which generates huge cashflows and dividends. If you held for a decade you'd get your money back just in dividends because of their cash generation potential.
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I’m all about dividend yielding stocks with a good PE ratio but at the moment I’m torn! Like you say Tabacco and event alcohol are profitable but governments are cracking down on those industries and continue to pound it with sin tax which scalps profits into tax
I do like some energy minging and lumber stocks in Brazil look good but j still need to do the calculations on inflation in those countries and then the exchange rates because a lot of this could LOOk like you making money but you actually making a loss
With the bond market and gold markets kept down by government policy it’s hard to price assets and cash flow
So I just Make it simple and hit the BTC if BTCs yield eventually comes down you can jump into value stonks that offer a better return
Trump's anti-vaping campaign dented the tobacco companies a bit. But they are incredibly resilient and they have the ability to hike prices and still make sales.
If there is a global rebound after covid, the energy mining stocks should do well. Can't have a boom without energy!
I agree they can hike prices and still get sales but there is a limit where hiking prices reduces sales abs you have to strike that balance. Also with covid and people all health focused I’m not so sure on that trade but that’s just me picking at narratives
I think every market will have a “rebound” I just don’t know how high and even if it reaches old highs how much of that is value versus inflation.