Coke (KO) / Con Ed (ED)
Yes -- Coke (KO) split TWO for ONE --- so the share price drops to half what it was --- and also the dividend is now cut in half (from where it was) so is now .255 per share per quarter.... BUT of course - you have twice as many shares.
Con Ed (ED) went EX dividend today... so it will most likely trade down.... but of course.... it also is sending you .605 per share dividend. Note that this name is highly "defensive" and is a "blue haired old lady stock" IMHO... Utilities are like that... cause even if you're broke ya gotta pay your electricity bill! This stock is UP 55% in the last 3 years -- most likely because people have flocked to the "safety" of names like this. I'd expect a "rotation" out of this name - if the economy heads UP...
ROTATION is a very important factor in the stock market. Remember that while we want to pick great names.... NOBODY can fight market trends. The HERD mentality can and does affect your holdings. Make no mistake about this. A market is up when more people want to buy what you have than sell it.. and the reverse is also true! So if the HERD (big money) starts to think they can make a better return in TECH over "steady eddy" Con Ed... then they'll sell ED and buy "X" tech company. You can substitute various names here but that is what a market is.
There never seems to be more money = the money just rotates. Most people need to sell something to buy something else whether it's houses - cars - or stocks. So IF the economy is seen as turning around --- then we'll see a ROTATION out of steady eddy dividend payers to "cyclicals" - and the "industrials" and "tech" etc.
Here's the way I think about this... so let's just use Con Ed (ED) as an example.
Every quarter these guys send me .60 cents per share... ($2.40 per year). If the share price goes down $5.00 I don't really care (right now) because I own it for that check they're sending me. I really only care about the share price when I'm ready to SELL it. If I'm nowhere near selling it... then it's just a placeholder. That placeholder still owes me money though! And pays right on time. If I'm holding it for 10 years... then they've sent me $24.00.... and my guess is 10 years from now - the price per share should be higher than what I paid for it AND I've gotten $24.00 in cash on top of that. (dividends in IRAs should be re-invested but either way - you got the money).
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