dealtn wrote:OhNoNotimAgain wrote:The 2021 Barclays Equity Gilt study says this in relation to UK equities:
Figure 9 and Figure 10 show how reinvestment of income affects the performance of the various
asset classes. Figure 9 shows £100 invested at the end of 1899 without reinvesting income; the
second is with reinvestment. £100 invested in equities at the end of 1899 would be worth just
£167 in real terms without the reinvestment of dividend income; however, with reinvestment,
the portfolio would have grown to £32,025.
Is it news to anybody that a bath fills quicker with the plug in?
Quite agree, dealt, obvious. as you say. I like your bath analogy, but it is very basic underlying maths anyway, no need for any complicated effort by Barclays or anybody.
But of course NotHim.., who is in fact Rob Munro, a FUND MANAGER, is known for quoting anything and everything. It is a shame that he cannot put any of this knowledge properly in practice. His so called Smart Fund (VT MUNRO SMART-BETA ) has returned a paltry 3.11% compound, income reinvested, since inception on 14/09/2007 ( which is basically ZILCH if one takes RPI into account). So in his case reinvestment of divi have not compensated for a dreadful capital performance. Blind HY investing( some would say absolutely ridiculous in the underlying method in his case), has been a disastrous approach, as it so often is in my experience.
Regards
Bagger