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Real yield is often negative
A 4% dividend yield is an illusion of profit if inflation rates exceed that figure. While receiving nominal income, you are actually watching the purchasing power of your capital erode year after year.
The math is simple: if inflation is 5% and your dividends yield 4%, your real return is -1%. You are not getting richer; you are slowly losing the ability to purchase the same basket of goods that was available yesterday.
#Investing #Inflation