The most recent rally has not only
produced substantial returns, it has done so in a relatively consistent manner.
Not exact matches
In short, dividend reinvestment
produces a
substantial part of overall equity market
returns, and aggregate dividend growth is a strong indicator for overall market performance.
High -
return assets that
produce a
substantial amount of their
return through taxable income, on the other hand, should be primarily held in tax - deferred accounts such as IRAs and 401 (k) s.
Even with very modest sales growth, a dedicated focus on margins, cash flow, and frequent &
substantial returns of capital (via buybacks & tenders), will almost invariably
produce superior long - term shareholder
returns.
However, the predictability coupled with a short holding period
produces quite decent average annual rates of
return after allowance for the occasional
substantial loss.