Archive for August 2024
Why Dividend Yield Alone Isn’t Enough
When evaluating dividend stocks, many investors are drawn to the allure of a high dividend yield. However, focusing solely on yield can be a dangerous strategy. A high yield might seem attractive on the surface, but it could be a sign of underlying issues, such as a declining stock price or a company struggling to…
Read MoreUnderstanding Dividend Payout Ratios
Understanding dividend payout ratios is especially important when investing in Regulated Investment Companies (RICs), such as REITs and BDCs. RICs are required by law to distribute the majority of their taxable income to shareholders as dividends, which makes their payout ratios a critical factor in assessing their financial health and long-term sustainability. The typical…
Read MoreThe Power of Monthly Dividend Stocks
When it comes to consistent income generation, few strategies can match the power of monthly dividend stocks. Unlike traditional quarterly dividend stocks, monthly dividend stocks provide investors with regular cash flow, making them an ideal choice for those looking to supplement their income or especially when you reinvest those dividends for compounded growth more frequently.…
Read MoreDividend ETFs vs. Individual Stocks: Which Is Better?
When it comes to building a dividend portfolio, the choice between Dividend ETFs and Individual Stocks often boils down to control versus convenience. Dividend ETFs offer the convenience of instant diversification, spreading your investment across multiple dividend-paying companies, which can reduce risk. However, they often come with management fees and less flexibility, as you’re at…
Read MoreAI in the age of Dividend Investing
Should you be using AI insights for dividend income investing advice? We feel at Fly High Investing that Generative AI like ChatGPT or Anthropic’s Claude (among many) can offer some useful information to help with decision making, but the influx of daily AI-driven news can be a double-edged sword and AI derived news is…
Read MoreWhere are all the Bulls?
Seems the bulls in dividend income investing are taking a cautious approach, balancing between high yields and sustainability. With some stocks offering double-digit yields, there’s excitement, but also concern over the potential risks. Many investors are focusing on dividend aristocrats—a list of moderate companies with a long history of increasing payouts—to ensure steady income amidst…
Read MoreDividends vs. Buybacks: Which is Better?
As some companies struggle amidst recent market downturns, many are reporting stock buybacks in a bid to boost stock price. When comparing dividends to stock buybacks, dividends often come out ahead for long-term investors focused on compounding. Dividends provide immediate cash flow, which can be reinvested to purchase more shares, leading to compound growth over…
Read MoreHow Dividend Stocks Weather Market Crashes
Dividend stocks have a unique resilience during market crashes, often providing a buffer against extreme volatility. This resilience stems from their underlying business models, which typically involve stable, mature companies with consistent cash flows. During a market downturn, the reliable income from dividends can help cushion the blow for investors, providing a steady return even…
Read MoreUnderstanding the role of Adjusted Funds from Operations (AFFO) and Net Operating Income (NOI)
AFFO and NOI are data points that can be used for assessing the sustainability of dividends in income-generating investments. These metrics provide a clearer picture of a company’s financial health, particularly in sectors like real estate and business development, where consistent cash flow is key to maintaining and growing dividend payouts. It’s important to…
Read MoreNo boats floating?
Seems like almost no financial boat is floating today, the current challenging market conditions where various economic factors are causing turbulence across different sectors, making it difficult for investments to perform well especially when there is a prevailing fear cycle. One major reason is the ongoing uncertainty in the global economic landscape, particularly due…
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