This Dividend Capture Strategy Just Might Actually Work (High-Yield Dividend ETFs)
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- เผยแพร่เมื่อ 30 ก.ย. 2024
- Let's talk about the Dividend Capture Strategy and whether or not it will work using the high-yielding ETFs knowing as Yieldmax funds. I go over how I'm trying out this strategy with my own portfolio, and plan on updating you on how it goes after a few months of trying. Will I actually produce income for my stock portfolio, or will it completely flop?
Let me know what you think!
you might want to consider, buying on the ex div date, since the share price is adjusted Down (by the div amount) at Open. So if you buy shares on the ex div date, they are discounted and Usually pop back up next day. That way you get the gain without triggering a tax event, as unrecognized gains. So this also is a way to "harvest the divy" by purchasing when the shares are discounted, and realizing the gains when the share price pops back , but no tax payment. Keeps your Cost Basis Low as well.
Yes, great point. I’m planning on adding even more shares when the prices drop on the ex dividend date for those reasons.
@@daviswatkinsyt I plan on using both strategy one in Roth account (Div-capture) and other in taxable (Ex-Div buy lows / sell high) account. However, I've not tested the tax implications for buying/selling after ex-div when stock price gains value. And technically you have not lost by buying low and selling high and earned profit, therefore taxable. Could you please shed some light on this if you tested it?
I plan on using both strategy one in Roth account (Div-capture) and other in taxable (Ex-Div buy lows / sell high) account. However, I've not tested the tax implications for buying/selling after ex-div when stock price gains value. And technically you have not lost by buying low and selling high and earned profit, therefore taxable. Could you please shed some light on this if you tested it?
thank you for an idea I never thought of. this could work esp if other factors like company fundamentals are good.
@@daviswatkinsyt
The NAV erosion thing is just how these income funds will go. I've used a 2-pronged approach thats worked well for me. I just buy Bitcoin for 3 years, sell in the bull market, move those into these income funds. The growth far outpaces any drip I could have done. But you have to survive 3-4 years of NAV erosion.
Interesting strategy, can’t wait to see how it goes. I personally lost money holding TSLY.
Yeah I purposely left TSLY out 😅
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Don't do this strategy. All of those ETFs will trade ex-dividend and negate any dividend payments you will receive. The price might not drop exactly as much as the dividend but when you pay taxes on your dividends at the end of the year it will be a complete wash and a waste of time.
Not all of them have dropped significantly ex-dividend date. Some of the underlying stocks will drop a few days before and rise 5-10% even days after the ex date. I’ll also buy after the ex date to lower the avg cost and recoup any losses depending on how far they fall within the week. We’ll see how it goes!
Super cool idea - love it! I own YMAX - just received a payment...price went from 20.62 to 19.97 (on ex-div date) and payout was .73 for the month...so ahead slightly right away. If sold on the record date, one day later, then I could have sold for ~20.05. So, you could have bought for ~20.62, sold for ~20.05 (loss of ~.47) but payout of .73, so gain of ~.16...just an estimate, but that would be close to what I believe you are talking about here...I have 750 shares, so that would be a gain of $120, in 3 days. I'm holding my shares for now, but your idea is a good one/interesting...you could also do this with much more stable, monthly paying funds like JAAA or JBBB - just a thought - month after month they pay their dividend and then through the month regain their NAV...many other examples like that as well.
Regardless - great video - keep up the amazing work!
Thanks! Yes, YMAX is one that I’ll use with this strategy as well, just missed the ex dividend date a few days ago.
I’m not familiar with JAAA and JBBB but excited to look more into them.
Updates?
Interested in seeing how this goes! 👍🏼
We’ll see!
I think you need to buy before the ex-div date to be included in the payout, no? and you can sell on the ex-div date and still be included, because the trade doesn't clear until the next day. correct me if I am wrong.
ok, I just listened until 3:15, I see you will buy before the ex-div date but I think you can sell on the ex-div date and still be included in it.
with these ymax funds might want to consider selling a day or two before ex-date and then repurchase once the price drops. this way you can make money both ways. The price typically rises before ex-date and thus you secure capital (the core compounding method) then with the shares you still own you'll get paid distributions. Then you use that capital to repurchase at the lower price post ex-div and end up getting paid twice and also owning more shares. #AMZYARMY #ORACLE
But to get dividends, don’t you have to buy them at least 1-2 days before the ex-div date?
Killer info. 🎉