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BrandonQuinnDixon OP t1_j2en1c8 wrote

Reply to comment by nkyguy1988 in Question about dividend re-investment strategy by BrandonQuinnDixon

In that case, I'll have to re-evaluate my reasoning. I think the base of it still holds, but now if I buy stock right before the ex date, I'll be buying it at local maxima point. On the other hand, if I buy it right after the payout, it will be lower, but then I won't see any return for more time.

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DeluxeXL t1_j2enh30 wrote

> then I won't see any return for more time.

You will see return, just not "forcibly realized return".

Dividend distribution is a forced taxable income, whether you want it or not, whether you are in 15% tax rate or worse.

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nkyguy1988 t1_j2enyum wrote

Yield is yield. A 10% growth, no dividend yield is the same as a 3% dividend and 7% growth. Plus, the added benefit of not being forced into a taxable event, if within a taxable account.

You never want to "buy the dividend" it's a net zero and taxable, again if within a taxable account.

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Citryphus t1_j2eopa8 wrote

If you plan to hold the stocks long term in a taxable account, you should prefer to buy on/after the ex-dividend date.

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