Tuesday, November 29, 2016

Prechter on Dividends

"[T]he greater investors' pessimism, the more dividend payout matters to them, and the greater their optimism, the less relevant or necessary it is deemed. In today's market environment, dividends are actually considered a detriment to stock ownership, the theory being that it is better for management to put the money back into the company to make it grow faster. As far as I can determine, this attitude is unprecedented."
- The Wave Principle of Human Social Behavior and the New Science of Socionomics

1 comment:

ADL said...

Maybe applies at the margins. A great number of investors are (entirely or partially) dividend investors; it is they who stampede to the exits when dividends are cut, as is a much more common reaction than a stampede to the entrance. There are many different investing communities and audiences, of course, and some receive far more attention--and thus are likelier to be characterized as "the market"--than others.