jackdaww wrote:
Some articles very recently in the IC about this very subject I think - which I take to debunk the high yield approach .
Well you can't beat a bit of confirmation-bias every now and then, can you...
But more seriously, I think it's going to be difficult to 'debunk' a whole investment strategy whilst it clearly continues to be used by some investors, many of which post here, and who continue to enjoy the benefits that are delivered *for them* by using it...
So if we hopefully might agree that, then what are we really left with?
I suppose we're left with saying that a *high-yield* approach might not actually deliver to a particular investors
individual requirements all the time, and of course, it's clear that this might be the case, just the same as we might agree that 'value investing' might not suit a particular investor, who might not possess the analytical skills often required to highlight 'value investing candidates' - but if you're one of those investors who doesn't have the analytical skills for value-investing, does it give anyone the right to 'debunk' the whole approach, or do we just accept that there's perhaps
some strategies that don't suit some particular investors, but that it also clearly *does* suit
others, and we might perhaps simply move on, without the need to want to 'debunk' anything?
And I suppose we're also left, perhaps, with saying that a *high-yield* approach might not suit an investor with regards to short, medium, or long-term volatility, or
reliability, and again, it's clear that this might be the case, but if there's high-yield investors
who are happy to live with those potential issues, and are happy to create and live with any long-term coping strategies that might be required to manage them, then does the actual existence of the
potential issues give anyone the right to 'debunk' the whole approach, or do we again simply accept that there's
some strategies that might contain inherent aspects of them that might not suit some investors to have to cope with, but also that it clearly *does* suit others who are perhaps happier to 'cope' with those aspects, and so we might simply 'move on' again, without the need to want to 'debunk' anything at all...
I think the word 'debunk' carries with it an implication that something simply 'doesn't work', and that clearly can't be true if we've got long-term posters here who have managed to retire and continue to enjoy the results from taking a high-yield approach, so if we might agree that (and if you don't, then I'd be interested to hear why not..), we seem to be left with the fact that taking a high-yield approach simply might not 'suit
everybody' in terms of what they might be looking for from an investment strategy, and I really don't think there'd be any arguments at all if that was where we'd perhaps land with this, as it's clearly true that there are *many* investment approaches that we might look to take as individual investors, and it's likely that there's *many* of those investment approaches that might not suit
our individual requirements, so why would it be so surprising to find that a high-yield approach might be contained in that list of '
sorry, that doesn't suit me' list?
To be clear, and for the avoidance of any doubt, I would absolutely put myself in that latter category - I've taken a high-yield (single-share) approach in the past, and it didn't suit me, and I moved on, but that wasn't because I'd 'debunked' the approach, but because I'd learnt enough about it's particular risks and foibles to clearly understand that, whilst it's clear that there are mitigating strategies that can be taken to cope with them, it wasn't going to suit
me as an individual to have to do that over the long-term that I needed my investment strategy to last, and because the results I'd seen from it didn't suit me as an individual investor...
That's not to say that there's clearly many investors who are much happier to live with them, and for those, it's clear that a high-yield approach *does* suit them better than it suited me, so how can such an approach be completely 'debunked', when people are quite happily using it?
That would be like taking a BMW and Audi for a test-drive, finding yourself much preferring the Audi, and then trying to 'debunk' BMW's....
As an aside though, and remembering that this thread is actually talking about '
Different ways of taking income', I do think it's again important to point out that *not all* dividend-based strategies are using a 'high-yield' approach, and there very often seems to be an assumption with these types of discussions that all income-investors are to be
automatically assumed to be 'high-yield' investors, with all the 'high-yield' implications that such an approach might bring, and I do think it's very important to acknowledge that there are *many* income-investors on these boards that have
recognised the reliability and volatility issues with focussing on the word 'high', and are
much happier to look further down the yield curve to more 'medium' yielding investments, many of which don't suffer from the volatility and reliability issues perhaps seen with many of the more 'higher yielding' options.
That would certainly describe my own investment journey towards lower-yielding collective investments, which deliver dividend-based results that I'm personally much, much happier with in terms of a long-term investment strategy, but I think it's very important not to fall into what seems to be a regular trap on these boards, where anyone wanting to discuss 'income-investment' is automatically assumed to be talking from a 'high-yield' approach, and it's important to recognise that this clearly *isn't* the case, and so such assumptions aren't very helpful on a thread that's simply wanting to discuss different ways of *taking* income, rather than making incorrect assumptions about which approach might be being used to *generate* the income for those of us taking a more 'dividend-delivery' approach...
Cheers,
Itsallaguess