In this weekly report, possible options are discussed using dividends rebalancing. Especially in neutral market phases, with Dividend Alarm Indicator these are values between 40% and 60%, you can further optimize your portfolio in terms of profitability.
Shortly said – The basic idea in dividend rebalancing: You part with stocks that have generated a sale signal and invest the capital in comparable stocks with a current buy signal.
As a result, the budget currently invested in expensive and overvalued low-dividend stocks is invested in industry peers that are currently cheap and undervalued while also generating higher dividend income.
In order to make a real comparison of individual positions, the focus must always be on the net dividend yield (tax deduction from the gross dividend). For this reason, certain comparisons always refer to the net dividend yield.
Important: At this point we would like to point out that the simple generation of a signal does not mean an immediate recommendation for action! A stock that has activated a buy-signal may therefore not be bought blindly and immediately! The signal activation is only intended to indicate a rare event. Why this happened with a stock and whether the stock is actually worth buying or selling must first be clarified through own research.