This article is a website version of our weekly FREE Best Ideas Newsletter sent on 26.08.2024. Sign up here to get it in your inbox every Tuesday.
“I tried the dividend strategy, but it was a bit boring, so I quit.”
A customer mentioned this when we discussed ways he could improve his investment process. I understand that he found the dividend strategy boring and decided to quit. (He was referring to the strategy we follow in the Shareholder Yield Letter)
We designed it to be exactly that, boring but with great returns.
I think it was Warren Buffett that said it best:
“Investing should be as exciting as watching paint dry.”
That is exactly what a great investment strategy should do. Be steady and predictable, not exciting with big ups and downs. We believe that "boring" is good for your long-term wealth.
Dull With Great Returns
The Shareholder Yield strategy, although seemingly dull, offers impressive long-term results. For example, an 80 year back test and found that it had a 97% chance to outperform the market by an average of 3.4% per year.
It also has a different risk and return profile compared to other strategies. This is because you get income through dividends, which you reinvest, and this “interest on interest” is what really grows your wealth over time.
If You Want Excitement
If you want excitement, we suggest you allocate a small portion (5-10%) of your portfolio to high-risk strategies and investments like artificial intelligence, trading Tesla, or crypto.
This way, you satisfy your need for excitement while letting the big part of your portfolio grow steadily through proven strategies like Shareholder Yield.
Why Shareholder Yield?
The Shareholder Yield strategy focuses on companies that return the most cash to their shareholders through dividends and buybacks. This approach has a strong track record. It’s not just about income but about investing in financially strong companies that prioritize their shareholders.
Examples of well-known companies in the portfolio:
- Johnson & Johnson (dividend yield 3.1%, buyback yield 7.4%),
- General Motors (dividend yield 1.0%, buyback yield 18.0%),
- Mercedes-Benz (dividend yield 8.7%, buyback yield 8.1%),
- Equinor (dividend yield 11.1%, buyback yield 5.8%), and
- Imperial Brands (dividend yield 6.9%, buyback yield 6.2%)
These companies combine high dividend payouts with aggressive buybacks, making them attractive investments that can withstand market volatility.
Investing is About Building Your Wealth
Investing should not be about quick thrills but about building your wealth over time with strategies that work. Shareholder Yield offers a methodical, well-researched approach with a proven track record.
I invite you to explore this strategy further and see how it can fit into your investment goals.
The following article (click the button) shows you the exact process we use to choose the ideas for the newsletter, you can of course do it yourself by following the steps or if you want to save time you can let us do all the work for you.
Click here to find out how we find ideas for the Shareholder Yield investment newsletter.
To learn more about the Shareholder Yield strategy click here: Invest big, win bigger with our market beating large-cap strategy!
Want to have a look before you subscribe? Simply click the Need Help (bottom right button) and write an email with “Shareholder Yield trial issue” in the email and we will send you a recent issue to review.
Your, boring but good investment strategy analyst
Wishing you profitable investing!
PS Here is that link to learn more about the boring but great investment strategy: Shareholder Yield - The best large cap investment strategy we tested
