I don't get that logic. I assume you are talking about a $200 stock that pays a $7.00 dividend each quarter. That works out to an annual $28.00 dividend per year - an annualized 14% return on your initial $200.
Why would that investment be silly?
My mistake!
I was using Boeing and their dividend total
is ANNUAL, not monthly for an example.
I think it was total $8.22 in 2022.
for a $206 stock return, is
4%
I get 5+% on Tbills.
It is a way to get some of the money I send to the IRS
back.
And if you hold that for a while, your investment cost “nothing.”
Can you imagine a company paying an annual 14% dividend? They would be swimming in cash.
I noticed that myself.
And also wondered where I could find that magic stock. Today’s companies, especially the trendy techy ones, don’t even pay dividends and only benefit their shareholders when they quit being shareholders. If they time their sale appropriately.
It seems high div companies have been pulling back, as well, or only become high div percentagewise after the price of the stock falls, and they are in danger of quitting the yields or going to zero.