Though I’ve heard people who utilise the strat prefer quarterly/bi annual payers due to higher payouts. I was toying with the idea of monthly’s dividend payers, they are largely predictable when the ex dividend date will be. You’ll also want to minimize risk by choosing multiple stocks with similar ex Div dates. Again low volatility is good and there’s some back testing to be done to be sure your stock picks will cooperate (maybe) good choices bounce back in a week or 2 So you have to wait for the stock to bounce back before selling is viable. Stock is $10, dividend pays 1.00 stock is now worth $9. And stocks you don’t mind bag holding.Īnother risk: What typically happens following a dividend is the stock adjusts for said dividend. So you want to look for stocks with a low volatility. There is the obvious risk, buy a stock and then it falls, which is the game we’re playing anyway. With that said, the more skin you’ve got in the game, the more you stand to profit and the faster you’ll beat the tax threshold. So if you were set to make $1000 just holding the stock vs if you make $2000 with the DCS and you pay 500 extra tax, you’ve still made good money. However if you do it well and make enough bread, it will effectively nullify how much you give back to the man. From my research the biggest shortfall is the tax implications from ordinary vs qualified dividends. I’ve thought so much about this strategy, but haven’t pulled the trigger. I plan on moving dividend payments into stable etf’s and growth etf’s and currently hold $Sphd, $Schd, and $Upro. 2-1% roi before ex date.Īny comments or suggestions would be greatfully appreciated, and leave some of your experiances (good or bad) I’m wondering if this strategy actually works or if I’m just asking to get burned. ![]() This week I have 13k into Cracker Barrel and another 8k into $EGBN. I put 18k into $RVi, which is seemingly risky now and and trying to recover the 2% loss I’m sitting at now before the special dividend hits. + dividend payment later this month, and have had holdings in $NRZ for a few years now, which had a recent ex-date. Last week I moved 10k into $FUNC(bank stock) and sold on ex-date for a 2% R.O.I. I’m 26 and using my middle account ($60k), what types of stocks do you guys look for using this strategy(banks, reit’s, blue chip, ect)? Also how much money would you reccommend into each position? I’m just starting out this strategy, (began last week) and I’m looking for some advice from anyone who’s had experiance or is currently doing this.
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