Something else different this year
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We’re going to the mid-election elections again this year. It’s not the kind of thing that dominates headlines every day. As a dividend investor, you’ll know this has been a rough patch for investors. Since 1950, the US stock market has delivered only about half the typical return during the midterm years compared with other years. This is because of political uncertainty, typically marking the weakest year in the four-year presidential cycle. In a normal year, the S&P 500 has returned ~9.5% on average. In midterm years, the average gains drop to ~4.7%. Of course, not every mid-term year is that extreme. In 2018, the S&P 500 was down a very low single digits. What’s more, Mr. Market obviously doesn't like uncertainty, especially how one man is trying to actively reshape the US to serve narrower national interests – using tariffs, creating conflicts, restricting technology exports, and blocking supply chains. During mid-term years, the US stock market generally underperforms between May and October... Every cycle is different. And the silver lining is markets tend to rebound strongly after Election Day. Now entering the mid-term elections this year... This means one thing: learning to ride out market volatility, it pays to safely build a global dividend portfolio. Why? Because such events could impact different stock markets. Some stocks you buy today can outperform the rest in one period. Some stocks may underperform the next. The quiet force behind growing our wealth is to build a global dividend portfolio. This way, when you diversify across different baskets of stocks and sectors, you’re protected against the dangers of losing money over the long term and able to better collect your regular stream of dividend income. Sometimes, investing can be simple. Willie Keng, CFA Founder, dividendtitan.com P.S. Like this issue? Click HERE to join other dividend investors reading my DT Compound Letter. I send my regular letters to your inbox. |
Dividend Titan
We’ve got a terrible war at hand. Whether it’s about to end soon or not, it’s hard to say. But I’ve been watching Singapore REITs fall lately because of this. Not good, not good... Credit: Singapore Exchange iEdge S-REIT Leaders Index What’s happening in the Middle East is obviously making people nervous. There's fears that interest rates could go back up because of higher oil prices and rising inflation. What’s more, the Fed recently put interest rates on hold before further cuts. That made...
CapitaLand Ascendas REIT is now trading ~6% dividend yield. What's more recently, Ascendas REIT announced its equity offering to acquire three properties worth ~S$1.4 billion. This is ~10% of its market cap. The deal could further raise the REIT’s DPU by 4%. Not too bad. Not too bad. You’ll expect Mr. Market reacted positively but instead shares went no where after the announcement. So what’s missing here? And is it worth buying today? Let's dive in. Sometimes, investing can be simple. Willie...
I’m kidding. You can never eliminate market noise. Unless we put a huge box over our head and don’t step out of the house. In recent months, headline news from the Iran conflict keeps changing many times a day. And that’s a big reason why stocks have been bouncing up and down. Somewhere in the middle of all that, I found myself thinking about the most common piece of advice gurus and advisors love to give: “Just ignore the market noise". “Just ignore the market noise.” Yes, they are right....