Last week, Dan at the Canadian Couch Potato began a series of posts related to dividend investing. There is one fact in life. Put an Index Investor and Dividend Investor in the same room for a few minutes, and you are going to have some lively debate!
Index Investors point out you cannot beat the market, so just invest in the market itself – they are right! Dividend Investors believe you cannot beat the growth and stream of dividend income from high quality dividend paying stocks. They are right also! Personally I like the idea of combining both Index and Dividend Investing. As usual Dan provides excellent research and the diversity of opinion and responses is enlightening. He posted about four articles since last Friday, and they are all worth reading:
I’m Contemplating the Couch
I’m not talking about my sofa (or your sofa for that matter). I’m talking about the Canadian Couch Potato and Index Investing. Can you see a Potato hanging out with a Ninja?
I’ve been contemplating Index Investing since last year, but the recent posts at Couch Potato have got me thinking. I’m hardly ready to give up dividend investing, far from it! I Love Dividends! – this could be a new t-shirt But I also think there is merit to passive index investing. I’m planning to setup a separate TFSA with TD, and then give the Couch Potato a try. I think Index Investors have done well over the last few years because of climbing markets. But it will be interesting to see which portfolio prevails in 2011: the dividends with fixed-income (active) or the couch potato (passive).
More to come!!
And now for something completely different:
- Last week I discussed the merits and tax benefits of contributing to your TFSA instead of (or before) your RRSP. Many people still don’t understand the basic rules about the TFSA. Jaymus at Realized Returns follows up nicely on this with 10 Facts on Tax Free Savings Accounts and with 4 Popular Uses of the TFSA.
- Another interesting post at Horan Capital Advisors, on where we might be in the economic cycle: Sector Rotation and The Economic Cycle. If as Horan Capital points out we are indeed in a delayed early-cycle, that could signal interest rates may be going up sooner than later.
- Following his posts on Canadian Banks, The Passive Income Earner looks at TD Bank.
- Andrew Hallam loses part of his brain in Will Your Child Be As Lousy With Money.. No really he doesn’t, but you can read the article and find out (since the article is about having to work for something to value it).
- And lastly, some shameless promotion and honed in marketing skills at Realized Returns! Jaymus is giving away a free Kindle. You can get the contest details at Read my Drivel, win yourself a Kindle.