I recently had someone unsubscribe from this blog. That person was kind enough to let me know why - it was because I often endorse dividend growth investing. This former-reader pointed to a behavioural bias called 'mental accounting' to demonstrate what they believe to be the flaw in dividend growth investing. Instead of separating returns into two forms - dividends + capital growth - this person argued that investors should focus on total returns. Moreover, by focusing on companies that pay growing dividends I am ignoring a large part of the market (e.g. the Teslas, Snowflakes of the world).
The Irrelevance of Dividend Irrelevance
The Irrelevance of Dividend Irrelevance
The Irrelevance of Dividend Irrelevance
I recently had someone unsubscribe from this blog. That person was kind enough to let me know why - it was because I often endorse dividend growth investing. This former-reader pointed to a behavioural bias called 'mental accounting' to demonstrate what they believe to be the flaw in dividend growth investing. Instead of separating returns into two forms - dividends + capital growth - this person argued that investors should focus on total returns. Moreover, by focusing on companies that pay growing dividends I am ignoring a large part of the market (e.g. the Teslas, Snowflakes of the world).