09-21-2021, 02:05 PM
Dividends make absolutely no sense and its driving me nuts.
<!-- SC_OFF --><div class="md"><p>I hear people constantly praising dividends like it's the best thing of a stock. I hear from basic stock explanations that "A stockholder makes their money from dividends". I hear people say that dividends give them a steady stream of income. I hear people say that dividends give them an option on whether to reinvest in a company or take home the money.</p> <p>None of those arguements hold any weight at all. A dividend has a tax attached to it eating into your returns. A dividend literally eats into the value of your stock; 1% dividend is 1% decrease in stock value. You can literally sell the stock to collect your money on a regular basis, we have fractional shares you know.</p> <p>I am at the point of wonder why do we even buy stocks. What is the egg of the chicken? What is the underlying reason to why we buy stocks, and why they are worth anything? The only reasonable explanation I can think of is that company profits directly affect share prices but I can't even confirm that. I don't know anything anymore.</p> </div><!-- SC_ON --> submitted by <a href="https://www.reddit.com/user/Danickster"> /u/Danickster </a> <br/> <span><a href="https://www.reddit.com/r/investing/comments/psb4jb/dividends_make_absolutely_no_sense_and_its/">[link]</a></span> <span><a href="https://www.reddit.com/r/investing/comments/psb4jb/dividends_make_absolutely_no_sense_and_its/">[comments]</a></span>Kind Regards R
<!-- SC_OFF --><div class="md"><p>I hear people constantly praising dividends like it's the best thing of a stock. I hear from basic stock explanations that "A stockholder makes their money from dividends". I hear people say that dividends give them a steady stream of income. I hear people say that dividends give them an option on whether to reinvest in a company or take home the money.</p> <p>None of those arguements hold any weight at all. A dividend has a tax attached to it eating into your returns. A dividend literally eats into the value of your stock; 1% dividend is 1% decrease in stock value. You can literally sell the stock to collect your money on a regular basis, we have fractional shares you know.</p> <p>I am at the point of wonder why do we even buy stocks. What is the egg of the chicken? What is the underlying reason to why we buy stocks, and why they are worth anything? The only reasonable explanation I can think of is that company profits directly affect share prices but I can't even confirm that. I don't know anything anymore.</p> </div><!-- SC_ON --> submitted by <a href="https://www.reddit.com/user/Danickster"> /u/Danickster </a> <br/> <span><a href="https://www.reddit.com/r/investing/comments/psb4jb/dividends_make_absolutely_no_sense_and_its/">[link]</a></span> <span><a href="https://www.reddit.com/r/investing/comments/psb4jb/dividends_make_absolutely_no_sense_and_its/">[comments]</a></span>Kind Regards R