ElLobo,

It's safer to limit your spending to the income that your portfolio generates.

Does this mean that you only harvest .25% from your holding in BLU?

helmut

Does this mean that you only harvest .25% from your holding in BLU?

How in the world did you come up with this number? Not from what ElLobo wrote.

Have fun.

John Walter Russell 

JWR1945a:

Does this mean that you only harvest .25% from your holding in BLU?

How in the world did you come up with this number? Not from what ElLobo wrote.

Have fun.

John Walter Russell 

John,

.25% is the income yield for BLU as reported by CEFA. The distribution yield is 11.56%.

helmut 

"Just because an investor opts for higher yielding investments does not guarantee more long-term income."

Of course not.I never said it did.

 "CWGIX has had an average annul total return of 14.42% for fifteen years.By how much could have CWGIX improved their returns or lessened volatility by raising their yield using a third of its portfolio for dividend capture?Would the managers have made the capital appreciation any safer by selling assets internally to fund a distribution yield through a managed distribution plan?Would leverage have created higher returns over a 15-yearf period?
Would any of these tactics increase the combined earnings of the stocks held by CWGIX?"

Who knows?I would guess that it wouldn't have increased it's total return and may even have lowered it.But we'll never know what kind of payout it may have produced.   : )

-wes

Hi bilperk

I agree with the concern of your OP, but I haven't seen any mention yet of the following three points:

First, I think the reallocation telltale has shown up more in bonds than stocks.  I was lucky to retire 15 years ago with very high bond percentage yields available.  Some I locked in for 30 years.  As boomers now near retirement, their whole life they heard "convert to more bonds, and reap the yields."  Well, those yields are now history.  Yet the reallocations are underway.  I'm not sure many retirees realize how meager bond yields are, now.  Perhaps even underwater to true inflation.  Perhaps almost a bubble in bonds.  The potential for real loss exists in long term bonds.

Regarding stocks, the boomers are not being forced out of equities, but all the teachings and literature and advisors tell them to reduce equity allocations.  So they are doing it.  I've read some studies, like Seigel who thinks foreigners will pick up all the selling slack, but there is no good evidence yet to back this up. And there may be a subtle, beneficial, shift from growth to dividend paying stocks, which for the first time in decades are giving bonds competition re yield.

Lastly, and importantly, what is one to do.  Here's my take.  It doesn't matter if stock returns are less than the past decades, because there is no real growth alternative to beat it.  Stocks are a call on the underlying businesses, and their attendant growth and dividend increases, in whatever the currency is at the time.  So if the return is only 6% for the next decade or two, so be it.  That's why I support the direction of those investing for corporate dividends and companies which have good prospects of increasing dividends annually.  And if we have massive inflation, stocks will, in the long run, be the things to own.

Just some thoughts  (am I on the wrong forum? How did I get over here?)

retired at 48

Hi again retired/48,

You be on the right forum!

I tried to steer you here once before, you finally made it :o)

Glad to see you here and think you have much to offer.

Thanks for sharing your thoughts, stick around wont you?

Brian

Hi Brian...I'm expanding my horizons.  Thanks for your support. 

 retired at 48

retired at 48:

Hi Brian...I'm expanding my horizons.  Thanks for your support. 

 retired at 48

Hi 48,

This is a nice forum where everyone respects each others investment style and where we are able to challenge each other without rancor.  While most here believe their approach is best, they don't feel it necessary to convert everyone else.

Thanks for your points on the OP.

best,

Bill

Bill,

Good Morning!

"While most here believe their approach is best, they don't feel it necessary to convert everyone else."

There's a difference between 'beliefs' and 'feelings'.

I KNOW my approach is best, and WILL eventually convert you!

ElLobo, de la casa de la toro caca grande!

Good Morning to you El,

If your approach was so good, you wouldn't be up at 4:30 in the morning posting on M* trying to convince me :o}

best,

Bill

bilperk:

retired at 48:

Hi Brian...I'm expanding my horizons.  Thanks for your support. 

 retired at 48

Hi 48,

This is a nice forum where everyone respects each others investment style and where we are able to challenge each other without rancor.  While most here believe their approach is best, they don't feel it necessary to convert everyone else.

Thanks for your points on the OP.

best,

Bill

Hi Bill...thanks for your support.  I chose your posting to make my first response post on this forum, because I knew the replies would be civil.  I have enjoyed your posts elsewhere, and usually stop my mouse whenever I see "bilperk". 

BTW, Mel Lindauer linked us with the following words, quote:

There are lots of folks here (Diehards F.) who invest in managed funds, and they're certainly welcome here. However, they have reasons for doing what they do, and they're able to clearly state and explain why and how they handle their investments when someone asks. A few examples of Diehards who post here on a regular basis that don't walk the Diehards line include Billperk, Petrocelli and Retired@48. Each marches to a different drummer, but they're able to cleary explain why/how they invest the way they do when asked. ...Mel L. 

 I'm now just repositioning to Saratoga, upstate NY, home of horseracing, ballet, polo and other fine southern gentlemen activities.

R48