RE:RE:One's real cost baseAnd then your dividend yield on "original investment" would be ~400%+ instead of 168%. You would be swapping out "Suncor #1" for "Suncor #2".... but now getting 400%+ on "original cost base"
All just my opinion/view/thinkinking
RagingBull3 wrote: Original Cost Base is irrelevent, what matters is CURRENT Reward/Risk (Yield/Risk) relative to other investments.
Let's take a make up extreme example. Say you bought SU for a $1 originally.... so now your yield would be about 168% !!!! NOW on original cost base of $1!!! Does that mean you should Never Sell it, because you'll never find another stock yielding 168% dividend. Of coarse not... what matters is the yield now! The Reward/Risk profile now. If there was a "Suncor #2" that was exactly the same as this "Suncor #1" buy offered a dividend yield of 10% instead of 4%..... You would probably sell and buy #2 because you won't be selling for $1 you will be selling for ~$41.27 and buying.
Like Obscure1 says, cost base only matters when it comes to paying taxes.
All just my opinion/view/thinking
Obscure1 wrote: Clem brings up an interesting topic which is the perspective on one;s reference point cost base.
I agree that SU's divi is 8% on what I paid, but the reality is that history doesn't count with investments as today's price is the only relevant number.
One's historical cost base can either be the source of joy or pain depending upon the current market but in reality, the cost base is irrelevant other than for tax consequences.
At this stage of my life, I can look at my inability to perform certain physical feats that I could do in the past or the fact that I'm now invisible to the pretty young girls as a source of sadness. Or, I can look at my current health and age as my real cost base and make decisions based upon looking ahead.
The day when I no longer look forward will hopefully be the last day of my life. If we treated our investments the same way, I think we would be all be better investors.