yield vs total return There was a time when the mere thought of yield investing would have caused me a chuckle or a smirk.
As I have aged, yield has become a more important factor for me.
I took a swing at Tesla a couple of weeks ago and within a couple of days, I found myself completely uncomfortable and exited the position. It seems that my wild wild west days of the past are long gone.
Today, I look at yield and growth as equals in my investment decisions. One without the other seems pretty much unpalatable for me now other than for small positions.
ENB fits my current investment criteria to a "T".
I just can't get motivated by the lack of growth potential in Canadian banks. I don't know how the banks are going to be able to continue to squeeze out enough earnings growth to match the growth in dividends that their investors expect.
Utilities are relatively safe investments that typically offer a decent dividend rate, but it is difficult to be inspired by their growth potential.
I can't get excited about telcos. BCE has a nice yield, but is up only 32% in the last 20 years. Where is the growth going to come from going forward. I think I will take a stab at Starlink when it goes public,
I like Brookfield in the renewable market (ENB as well if I get my green coloured glasses on) but it is difficult to justify the prices of the renewables. While I sit and wait for a dip, I jumped into a private renewable company that provides unicorn potential but obviously comes with a level of risk that probably doesn't make sense for someone of my age. I have to admit that I like the adrenaline rush of a start up but the horse will have to grow a horn for it to become a core position.
Right now, my portfolio yields a little under 6%. The yield was almost 8% a few months ago but the market has moved up which has suppressed the current yield, which is not a bad thing.
I would be interested in what others think about yield vs total return and if their thoughts have shifted over the years.