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13:24
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Originally posted by david25:
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After some thought over the last couple of days I realize I have under estimated the market correction. Here is the issue Typically the bank rate would be 3%, growth, inflation and risk . The growth of 3%, inflation of about 2%, risk 3% to 5% of holding a volatile growth investment.What is different now. Resources are at an all time high, inflation is high, return on investment is low and we are approaching a recession, interest rates are rising. High inflation will impact the demand of investors for higher dividends in the asx. This will help explain why BHP is providing 12% return and the market is not valuing them higher. High Inflation will play a larger role in effecting company valuation through expectation of higher dividends.How will this effect RMS 2.3% return in a deflationary gold market.Door 2 . 12% in a diversified miner or an industrial stock. i n crease its dividend 400% to meet market demands for better return on investment and compete with inflation.
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Why would you hold for so long, genuine question?
(20min delay)