Don't chase dividends

Sunday papers often contain articles suggesting that investors look for high dividend paying stocks or 'income' funds to provide an income. Chasing 'natural yield' is not a free lunch. Dividends paid out cannot be put to use to by the company to improve future earnings. Being driven by dividends tends to result in often ill-considered risks, not least stock concentration, sector 'bets', skewed country allocations and style impacts. On the other hand, a total return approach helps to maintain portfolio structure integrity.

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AcuityINSIGHT: How much is enough of a good thing?Most of us can think back to our childhoods and remember a time when we ate too much ice-cream, the moment from feeling wonderful to feeling sick, so is there a point at which you can have too much of a good thing when it comes to index investing? In this issue we look into why to keep spooning in t

AcuityINSIGHT: Tempering FOMO and regret through diversificationIn this issue we look at why diversification matters because investors own portfolios today for the future and given that markets do a pretty good job of incorporating information into prices, we have no forward-looking insight into which company’s shares are going to outperform. We can avoid both

AcuityINSIGHT: Make your investment bed and lie in it!The reality is that markets work pretty well at incorporating information into prices and trying to beat the market – through either market timing or stock picking - is a tough game, with very few winners. Simply making your investment bed out of a diversified market exposure and lying in it over

Don't chase dividends

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