Lessons Learnt About Dividend Investing After Joining Telegram Discussion Group

When I first joined a Telegram discussion group focused on dividend investing, I was looking for an environment with like-minded investors where insights, strategies, and real-world experiences are widely shared from fellow investors.  While I had a basic understanding of dividend investing, engaging in discussions with very much more experienced individuals exposed me to deeper perspectives and valuable lessons that are shaping my investment philosophy.

Through my participation, I have come to embrace three key principles: 

1)     The importance of staying invested rather than frequently trading;

2)     Managing portfolio allocation wisely to mitigate risks; 

3)     Maintaining a calm and patient mindset while enjoying the rewards of dividends. 

These lessons have helped me refine my investment approach and reinforce my confidence as a dividend investor.

1)     Do Not Buy and Sell Shares Frequently: Time In Market Matters More Than Timing The Market

One of the biggest takeaways from the discussions was the importance of staying invested rather than trying to time the market.  Many investors in the group, especially those with long-term experience like Paul and STE, emphasized that frequent buying and selling rarely leads to sustained success. Instead, the stock market rewards patience.

For myself, this lesson was particularly simple, but yet require much discipline to execute.  In the past, I was tempted to trade frequently, thinking that I could take advantage of short-term price movements. However, hearing from seasoned investors who have held onto quality stocks for years and enjoyed both consistent dividend payouts and capital appreciation made me rethink my approach, which was mediocre at best based on portfolio performance.  The reality is that timing the market is extremely difficult, even for professionals.  Instead, consistently staying invested allows me to benefit from compounding returns and dividend growth over time.

Additionally, constantly monitoring stock prices and making frequent trades is mentally exhausting and time-consuming.  By shifting my focus to a long-term investment mindset, I have freed myself from unnecessary stress and can concentrate on selecting and holding quality dividend stocks that will provide steady passive income for years to come.

2)     Spread Out Individual Stock Allocation: No Single Stock Should Dominate the Portfolio

Another key learning point for me was the importance of diversifying stock allocation within my portfolio to avoid excessive exposure to any single company.  The general recommendation was to keep individual stock holdings below 5% of the total portfolio and limit core, strong stocks to a maximum of 15% allocation.  This rule serves as a safeguard against unforeseen events that could negatively impact a single stock.  No matter how well a company performs today, external factors such as economic downturns, industry disruptions, or company-specific scandals can cause significant losses.  If one stock makes up a large portion of the portfolio and something goes wrong, the financial consequences to my personal portfolio could be severe.

With regards to the need for diverse allocation, some people may question why don’t I just invest in ETFs like ES3.SI or CFA.SI, instead of managing so many individual stocks and worrying about these risks.  The reason is simple.  I have personal preferences for certain stocks.  I prefer owning a higher percentage of companies that I strongly believe in while avoiding stocks that I dislike.  Unlike ETFs, which are pre-structured baskets of stocks, investing in individual stocks gives me more control over my portfolio composition.  However, to manage risk effectively, I now ensure that no single stock has an outsized impact on my overall portfolio’s performance.

3)     Stay Chill and Enjoy the Dividends: Peace of Mind is Key

The final and most enjoyable lesson I learned is to stay calm and relaxed as a dividend investor.  Many members in the group emphasized that once you have built a portfolio of quality dividend stocks, there is no need to stress over daily price movements.  As long as I hold fundamentally strong companies that consistently generate profits and distribute dividends, I can simply sit back and let the dividends roll in.  Unlike traders who constantly analyze charts and news, dividend investors enjoy a much more relaxed approach to investing.  We focus on cash flow rather than short-term capital gains, which means we do not need to react to every market fluctuation.

This shift in mindset has significantly improved my investing experience.  Instead of constantly checking stock prices and feeling anxious about market trends, I now focus on living my life and enjoying my days.  Knowing that dividends will be paid out regularly gives me financial confidence and allows me to appreciate the passive income stream without unnecessary stress.  

The most evident part of this definitely lies on the stock market shock and turbulence through the past week.  On 2nd April 2025, US President Donald Trump announced the retaliatory tariffs against all other countries, and it sent shockwaves throughout the world markets.  In the two trading days that followed, ES3.SI dropped by 3.3%, Hang Seng Index (HSI) dropped by 1.5%, VT plunged by 9.6%, VOO plunged by 10.3% and QQQ plunged by 11.2%.  Personally, my portfolio has dropped by 2.6% in the first week of April, however, the mood in the TG group was not frantic nor was it filled with pessimism.  Even in the 2nd week of April, where ES3.SI dropped by 7.3% just on Monday, I am not too troubled by it (and yes, my portfolio did drop by another 5.4% just on Monday with a 5 digit paper loss).  Personally, my portfolio has tumbled by more than SGD 77K from all time high to Wednesday, before the sharp reversal happened due to the flip in Trump's policies, pushing my portfolio up by about 4.9% in 1 day.  Since we are not traders, the daily share price movements did not throw us into chaos, and that prevented any panic sale, allowing us to capture the full benefits of the sudden reversal.  For investors who has funds, they add on to their portfolio during such times.  For others who has limited or no available funds like myself (I am waiting for the dividends to flood my account in May, April is quite a drought, haha), I just patiently sit at the sidelines and ride through the volatility.  I believe most of us still sleep well at night despite the turmoil in the broader markets. 

Joining Dividend Investing Telegram discussion community has been an incredibly valuable experience and an enjoyable journey for me.  Through engaging with other like-minded investors and learning from their perspectives, I have reinforced my commitment to long-term investing, proper portfolio diversification, and a stress-free investment approach.  In fact, because dividend investing is so stress-free, we interact more over trivial and interesting daily life matters most of the time, and only rotate back to dividend discussions when payout day is near, or when there are big events happening on the macroeconomic environment.

By staying invested for the long run, spreading out stock allocations to manage risk, and maintaining a calm mindset, I am now more confident in my dividend investing journey towards my FIRE goals.  The goal is not just to grow wealth but also to enjoy peace of mind while building a steady passive income stream.  With that, I can sit back, relax, and wait for the dividends to flow into my account, while truly enjoying everyday life.  Barista FIRE, here I come...!