Investment Trusts?

Audaxer

ColdIron wrote: »

Yes, it's the share price that matters to you at that stage. But unless you have a lot of flexibility, waiting for the share price to rise might be a luxury you can't afford. If it hadn't risen, or failed to match inflation, you might consider that a couple of decades of steady and reliable income was a good trade off. For myself I don't intend to sell down my income investments until I need someone to wipe the dribble from my chin. I'll worry about the absolute share price when that day arrives

I don't intend to sell either unless absolutely necessary. An IT like CTY provides a yield of roughly 4% with dividends growing every year. After the long bull run, if we now had a couple of equity crashes in the next 10 years and CTY still continued to provide growing dividends, I would assume the share price would be unlikely to keep up with inflation over that 10 year period, it might even be lower than now at the end of 10 years. I appreciate that we retirees might just be happy collecting growing dividends, but is it a reasonable assumption that in these circumstances the share price is unlikely to have risen much if at all over that period?

ColdIron

Who can tell what the future will bring or the nature of those events and how they affect different sectors etc. Certainly you would expect something that pays out dividends to grow less than one that reinvests them. You would also expect something that invests in real companies making or providing goods or services that people want to buy will fare better against inflation than something like a high yield bond. I have a couple of growth and income portfolios and expect different outcomes