Comments on: The Power of Dividends http://www.thedividendguyblog.com/the-power-of-dividends/ One Guy's Journey to Passive Income Through Dividend Investing Fri, 10 Feb 2012 13:02:29 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: Anonymous http://www.thedividendguyblog.com/the-power-of-dividends/comment-page-1/#comment-7 Anonymous Wed, 30 Nov -0001 00:00:00 +0000 http://thedividendguyblog.com/?p=6#comment-7 <I>After only a couple of years, my dividend yield has gone from 3.34% to 4.08%.</I><BR/><BR/>No. Your yield is whatever the stock is yielding today. Your statement reflects one of the biggest misunderstandings about dividend based investing. After only a couple of years, my dividend yield has gone from 3.34% to 4.08%.

No. Your yield is whatever the stock is yielding today. Your statement reflects one of the biggest misunderstandings about dividend based investing.

]]> By: The Dividend Guy http://www.thedividendguyblog.com/the-power-of-dividends/comment-page-1/#comment-8 The Dividend Guy Wed, 30 Nov -0001 00:00:00 +0000 http://thedividendguyblog.com/?p=6#comment-8 This is a very hotly contested argument in the dividend-investing world. I remember reading an entire discussion about it over at the Motley Fool in one of the dividend message boards. Basically, the way I look at it is in terms of effective dividend yield - measuring the effect of a growing dividend on the amount of income a particular stock is throwing off. Calculating my effective dividend yield in this way provides me with proof that my investment is working and providing me with an increasing stream of income. I like this <A HREF="http://www.fool.com/news/commentary/2004/commentary04120601.htm" REL="nofollow"> article</A> at the Motley Fool to help describe what I mean (ignore the sales pitch!). Let me know why you don't think this is a good way to calculate the effective yield.<BR/><BR/>Thanks for the comment,<BR/><BR/>The Dividend Guy This is a very hotly contested argument in the dividend-investing world. I remember reading an entire discussion about it over at the Motley Fool in one of the dividend message boards. Basically, the way I look at it is in terms of effective dividend yield – measuring the effect of a growing dividend on the amount of income a particular stock is throwing off. Calculating my effective dividend yield in this way provides me with proof that my investment is working and providing me with an increasing stream of income. I like this article at the Motley Fool to help describe what I mean (ignore the sales pitch!). Let me know why you don’t think this is a good way to calculate the effective yield.

Thanks for the comment,

The Dividend Guy

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