Velacreations has the right idea, and is even trying to teach you, forgoing his own advantage.
Believe what you want, but those who can do better math, and those who are better at trading will just benefit more.
Believe what you want, but those who can do better math, and those who are better at trading will just benefit more.
You sound like MPOE-PR.
Despite her cold candor, default stubbornness, and abrasive approach, people could learn a lot from her.
The 5% mgmt fee on dividends does not directly devalue the share by 5%. The math is not as simple as that.
Share price and yield from dividend are not proportionally correlated. For example, it was not long ago that AM shares were half the price of today, and paying the same divs. Divs did not double, yet the price did.
Yes, there more plenty more factors affecting the share price difference than just the dividend difference. But in the conversation you were responding to, the difference of opinion wasn't about other complexities, it was about what difference the 5% reduced dividend should make to the share price, and Velacreations was mistaken on that point.Share price and yield from dividend are not proportionally correlated. For example, it was not long ago that AM shares were half the price of today, and paying the same divs. Divs did not double, yet the price did.
The point is that taking 5% off of the share price as a means of factoring the mgmt fee, is incorrect.
If I take 5% off the top, I have to take 5% off the bottom to have the same dividend yield.