The Dividend Letter

bigfreddiel
bigfreddiel Posts: 4,263 Forumite
in Savings & investments
Yet another newsletter from Fleet Street Publications called the Dividend Letter being touted by Moneyweek this week.

Its a high yield portfolio (HYP) method of investing.

I would appreciate any comments on this, do any of our bb members subscibe and could they comment.

Cheers

fj
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Comments

  • bigfreddiel
    bigfreddiel Posts: 4,263 Forumite
    does no one have any opinion or experince of this?

    cheers

    fj
  • Biggles
    Biggles Posts: 8,209 Forumite
    Combo Breaker First Post
    I have a (painful) experience of Fleet Street Publications/MoneyWeek (all part of the same company) and I avoid their myriad of publications like the plague.

    If you like the HYP theory, it's a very simple method of investing (there is a board devoted to it over on the Motley Fool site) and you really don't need a newsletter to tell you how to work out a yield.
  • dunstonh
    dunstonh Posts: 116,316 Forumite
    Name Dropper First Anniversary First Post Combo Breaker
    does no one have any opinion or experince of this?

    Head Vestor does ;)

    Fleet St Publications = assume waste of money and largely telling you nothing that you dont already know, wont be able to utilise or totally ignorant of real world scenarios.

    HYP = valid long term medium/high to high risk strategy which for most people that followed the MF examples would have seen above market average losses in recent times due to a reliance on bank shares paying good dividends.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • EdInvestor
    EdInvestor Posts: 15,749 Forumite
    dunstonh wrote: »
    HYP = valid long term medium/high to high risk strategy which for most people that followed the MF examples would have seen above market average losses in recent times due to a reliance on bank shares paying good dividends.

    Nonsense.The HYP idea is an income based strategy based on a diversified portfolio of at least 15 shares, of which a tiny minority will be banks. The Dividend Letter is written by Stephen Bland who invented the idea, and is well worth a subscription if you are new to this style of investing.
    Trying to keep it simple...;)
  • dunstonh
    dunstonh Posts: 116,316 Forumite
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    really? The HYP portfolio you posted in the past is over 45% down against the FTSE at 30% in the same period.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • jem16
    jem16 Posts: 19,397 Forumite
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    dunstonh wrote: »
    Head Vestor does ;)

    :rotfl: :rotfl:
  • Biggles
    Biggles Posts: 8,209 Forumite
    Combo Breaker First Post
    EdInvestor wrote: »
    The Dividend Letter is written by Stephen Bland who invented the idea, and is well worth a subscription if you are new to this style of investing.
    Whilst he may (or may not) have devised the idea that his version should contain 15 shares, and possibly even came up with the term 'HYP' for it, there's certainly nothing new about the idea of a high yield portfolio. Basically, he's just a journalist who wrote about it a lot, not an inventor.
  • Linton
    Linton Posts: 17,130 Forumite
    Name Dropper First Post First Anniversary Hung up my suit!
    dunstonh wrote: »
    really? The HYP portfolio you posted in the past is over 45% down against the FTSE at 30% in the same period.

    Oh dear - looks like we will be moving the long standing argument on Motley Fool over to here!

    There are two points of view - one is as suggested above, that HYP is an investment strategy which has recently been unsuccessful in dealing with the credit crunch..

    The other, which I favour, is that HYP is a successful income strategy for people who need a reasonably safe and steady income with some protection against inflation. Because there is to intention to sell HYP shares, temporary ups and downs in individual share prices do not matter. What does matter is that dividends continue to be paid.

    Companies are very reluctant to cut dividends and will only do so if there are serious problems. In fact dividends will tend to rise over time as company profits increase with inflation.

    Currently my dividend income is about 7% of current share value or 4% of original cost.

    I suggest anyone who is interested goes through the posts on the MF site.
  • opinions4u
    opinions4u Posts: 19,411 Forumite
    Linton wrote: »
    What does matter is that dividends continue to be paid.
    Not if paying a dividend out of profits that haven't actually been made affects the underlying value of the shares.
    Companies are very reluctant to cut dividends and will only do so if there are serious problems. In fact dividends will tend to rise over time as company profits increase with inflation.
    In a low inflation environment where profits in real terms are falling across the board, what use is this?
    Currently my dividend income is about 7% of current share value or 4% of original cost.
    And if the value of those companies halved again but they were stupid enough to maintain their dividends you'd have a 14% income to shout about.

    Doesn't make it a winner though.
  • jem16
    jem16 Posts: 19,397 Forumite
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    Linton wrote: »
    The other, which I favour, is that HYP is a successful income strategy for people who need a reasonably safe and steady income with some protection against inflation. Because there is to intention to sell HYP shares, temporary ups and downs in individual share prices do not matter. What does matter is that dividends continue to be paid.

    Looks like this person didn't quite understand the concept of, "as long as your dividends continue to be paid what does it matter what your capital is doing."

    http://forums.moneysavingexpert.com/showthread.html?t=1486859
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