Some general questions

[krasnaya]

Good morning,

Your theory is very interesting, I actually ordered Graham's book on value investing.

Accustomed to technical analysis, I nevertheless have many questions...

If I understand correctly, you should always buy, never sell. The goal is to select the best dividend providers. Ok, not very complicated theoretically.

What I understand less is, for example, the following two scenarios:

I buy a share for 50 euros. Good regular dividend that grows year after year. However, this share falls to 25 euros after 6 months. According to your theory, you should definitely not sell. How is a dividend of 2-3% net supposed to cushion such a sharp drop in price? In this case, the answer seems rather simple: strengthen your position at a low point.

The opposite situation, much less simple in my opinion: I buy the stock for 25 euros, and after 6 months, it is at 50 euros. According to your theory, you should definitely not sell, and miss out on this great PV. Again, how can a dividend of 2-3% net prevail over a PV of 100%?

Wouldn't it be ideal to combine your theory with a minimum of technical analysis?

Identify stocks that are good dividend providers, a sign of good financial situation, but by following the trend at least via one or two moving averages?

So it would be "enough" to select 5-6 stocks in your portfolio, with a minimum of 3-4 stars, but following the trends? That would make 2 to 3 purchases/sales per year, without entering into excessive speculation?

Good day!

[Jerome]

I'm not saying you should never sell. I'm saying that it's the fundamentals, especially earnings, that determine whether the company is and will continue to be able to pay dividends in the future. Sometimes you have to sell, either because the dividend is no longer sustainable or because it no longer has much room to grow.

Remember that dividends historically represent nearly half of the market's total profitability. By focusing on price gains/losses, you are forgetting this important reality.

On the subject of the sale of dividend securities, I invite you to read the following articles:

http://www.dividendes.ch/2011/12/quand-vendre-des-dividendes-croissants/

http://www.dividendes.ch/2012/05/prendre-ses-benefices-avec-des-payeurs-de-dividendes/

http://www.dividendes.ch/2012/07/vendre-un-titre-qui-sest-apprecie-pour-acheter-un-autre-meilleur-marche/

I am not a fan of technical analysis, because it is too open to interpretation and too many false signals. But it is possible to reconcile the two approaches if that is what you really want. On this subject, I invite you to consult the series of articles http://www.dividendes.ch/2012/04/dividendes-to-be-or-not-to-be-episode-1/

 

[krasnaya]

Can this table be used as a basis for choosing dividend stocks?

 

http://www.boursorama.com/bourse/actions/palmares/dividendes.phtml?MARCHE=1rPCAC&SECTEUR=&VARIATION=6

 

Is there the same thing for Sicavs?

 

Good day,

[Jerome]

This table focuses only on yields, which is dangerous. It is also necessary to take into account, among other things, the distribution ratio.

[Author]

Posts