Meb Faber: Why ‘Shareholder Yield’ Beats ‘Dividend Yield’

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Meb Faber: Why ‘Shareholder Yield’ Beats ‘Dividend Yield’

Why ‘Shareholder Yield’ Beats ‘Dividend Yield’ by Meb Faber

Guest: Episode #12 has no guest, but is co-hosted by Meb’s co-worker, Jeff Remsburg.

Date: 8/5/16

Star hedge fund macro trader Colin Lancaster warns: Inflation is back

InvestorsTalk of inflation has been swirling for some time amid all the stimulus that's been pouring into the market and the soaring debt levels in the U.S. The Federal Reserve has said that any inflation that does occur will be temporary, but one hedge fund macro trader says there are plenty of reasons not to Read More


Run-Time: 36:38

Topics:  If you’re a dividend investor, Episode 12 is for you. Yes, historical market data tells us that dividend stocks outperform the broad market. But that’s where too many investors stop. That same historical market data suggests we can improve our dividend-strategy returns—significantly—by a few tweaks. What are they? Well, paying dividends is just one of several ways that corporate managers can return profits to shareholders. They can also buy back stock and pay down debt (a subtler form, but valuable nonetheless). Together, we call these three returns “shareholder yield.” Shareholder yield provides investors a more holistic perspective on the degree to which corporate managers are sharing profits with investors. So when an investor limits his or her analysis simply to dividends, he/she runs the risk of overlooking companies that might be returning major profits to shareholders—but in less visible ways than dividends. That’s a problem because it turns out, when we combine these three yields, this “shareholder yield” strategy has posted better historical returns than dividends alone. How much better? Find out in Episode 12.

Episode Sponsor: Soothe

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Links from the Episode:

Read the transcript here.

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