Recently, a friend directed me to Giraffe Value’s blog post titled “Investing For Dividend Income(Passive) is a Fairytale!!!” The angle about dividends (that they cannot be considered passive income) brought forward by GV is refreshing indeed but I believe GV has missed out some salient points and thus decided to offer an alternative perspective in this topic by commenting in his blog. With GV’s knowledge, I herewith copy my comments (with very minor edits to make things more easily understood) below. It may be helpful if you first read GV’s article to understand his take on dividends.
|With the CD & XD effect, are Dividends paid out still considered Passive Income to the investor?
Readers of this blog would have realized my reply are drawn out of and adheres closely to the “Business Perspective” section in my Stocks Investment Philosophy in which my investment framework is based on.