Remove ads

Introducing the LemonFools Personal Finance Calculators

Where Have all the Chartists Gone?

Reading price charts which may give you direction in the market using established TA methodology
Lootman
Lemon Quarter
Posts: 4076
Joined: November 4th, 2016, 3:58 pm
Has thanked: 8 times
Been thanked: 635 times

Re: Where Have all the Chartists Gone?

#135997

Postby Lootman » May 1st, 2018, 12:27 pm

OhNoNotimAgain wrote:Dividends are inflation proofed as company's product prices, and usually profits and dividends, rise with inflation.

Yes, the total return partly reflects inflation, but there is no reason to deflate capital but not dividends with that effect.

You are trying to have your cake and eat it too, and we're not falling for it. Dividends provide about 40% of total returns. Moreover there is no evidence that total return is correlated to dividend yield. If there was then a share yielding 8% would give the highest return and one yielding 0% would give the lowest.

GoSeigen
Lemon Slice
Posts: 983
Joined: November 8th, 2016, 11:14 pm
Has thanked: 219 times
Been thanked: 217 times

Re: Where Have all the Chartists Gone?

#136026

Postby GoSeigen » May 1st, 2018, 1:44 pm

OhNoNotimAgain wrote:
Dividends are inflation proofed as company's product prices, and usually profits and dividends, rise with inflation.


Oh, so dividends rise with inflation and profits do, but you believe retained profits do not, and expected future earnings do not, so that market value of the company priced off those two variables also does not rise in line with inflation?

The magical dividends of fairyland!


GS

OhNoNotimAgain
Lemon Slice
Posts: 265
Joined: November 4th, 2016, 11:51 am
Has thanked: 14 times
Been thanked: 34 times

Re: Where Have all the Chartists Gone?

#136031

Postby OhNoNotimAgain » May 1st, 2018, 2:03 pm

Lootman wrote:
OhNoNotimAgain wrote:Dividends are inflation proofed as company's product prices, and usually profits and dividends, rise with inflation.

Yes, the total return partly reflects inflation, but there is no reason to deflate capital but not dividends with that effect.

You are trying to have your cake and eat it too, and we're not falling for it. Dividends provide about 40% of total returns. Moreover there is no evidence that total return is correlated to dividend yield. If there was then a share yielding 8% would give the highest return and one yielding 0% would give the lowest.


Repeatedly quoting an incorrect figure does not make it right.

No one, other than you, is talking about dividend yield. That incorporates price wheres I am talking only about dividends.

OhNoNotimAgain
Lemon Slice
Posts: 265
Joined: November 4th, 2016, 11:51 am
Has thanked: 14 times
Been thanked: 34 times

Re: Where Have all the Chartists Gone?

#136033

Postby OhNoNotimAgain » May 1st, 2018, 2:06 pm

GoSeigen wrote:
OhNoNotimAgain wrote:
Dividends are inflation proofed as company's product prices, and usually profits and dividends, rise with inflation.


Oh, so dividends rise with inflation and profits do, but you believe retained profits do not, and expected future earnings do not, so that market value of the company priced off those two variables also does not rise in line with inflation?

The magical dividends of fairyland!


GS


I think expected future earnings can often be fairyland stuff. Dividends are verified by a cash transfer, there is nothing magical about them.

Lootman
Lemon Quarter
Posts: 4076
Joined: November 4th, 2016, 3:58 pm
Has thanked: 8 times
Been thanked: 635 times

Re: Where Have all the Chartists Gone?

#136058

Postby Lootman » May 1st, 2018, 4:16 pm

OhNoNotimAgain wrote:No one, other than you, is talking about dividend yield. That incorporates price wheres I am talking only about dividends.

Since yield is the dividend expressed as a percentage of the price, it's the exact same thing, merely expressed differently.

And there is no more evidence that returns correlate to high dividends than that returns correlate to high yield.

OhNoNotimAgain
Lemon Slice
Posts: 265
Joined: November 4th, 2016, 11:51 am
Has thanked: 14 times
Been thanked: 34 times

Re: Where Have all the Chartists Gone?

#136059

Postby OhNoNotimAgain » May 1st, 2018, 4:26 pm

Lootman wrote:
OhNoNotimAgain wrote:No one, other than you, is talking about dividend yield. That incorporates price wheres I am talking only about dividends.

Since yield is the dividend expressed as a percentage of the price, it's the exact same thing, merely expressed differently.

And there is no more evidence that returns correlate to high dividends than that returns correlate to high yield.


With respect they are entirely different. A dividend is hard cash number. Yield is relative figure entirely dependent on the valuation, which is subjective, placed on it by a third party which can change. Once paid a dividend can never be changed.

DiamondEcho
Lemon Quarter
Posts: 2531
Joined: November 4th, 2016, 3:39 pm
Has thanked: 1841 times
Been thanked: 364 times

Re: Where Have all the Chartists Gone?

#136990

Postby DiamondEcho » May 4th, 2018, 10:38 pm

Lootman wrote:It's interesting that in the UK a low nominal share price is deemed desirable, whereas in the US a high nominal share price confers a sense of status and success. In reality of course it doesn't matter at all, except if you use options.


There is or certainly was something to this, historic I expect. US listed shares 'were expected' to fall within price bands, or else something within the commission or similar structure started handicapping them. So for example companies often had 'splits' at $100. Others engineered keeping their price above $10 or $20 for parallel reasons.
[I forget the rationale now, this is back from when I did my Series-7 in the 90s. It all seems rather arbitrary/archaic now, but that's how it was].


Return to “Technical Analysis”

Who is online

Users browsing this forum: No registered users and 1 guest