How Does Voting on Steemit Compare to Investing in a High Yield Dividend Stock?
I am currently not invested in the stock market. Yes, there are some nice returns to make now that we know the Federal Reserve backtracked on their plan to slowly raise rates. However, the risk of an imminent crash is too great for me to work for a 10-15% return over the next few weeks while the debt ceiling in the U.S. government looms.
What I realized last night as I was calculating some numbers is that curating on Steemit is earning me the same rate of return as investing in a closed end fund.
If you are not familiar with a closed end fund, the main thing you need to know is that it is a dividend machine. While a CEF can be more volatile than a mutual fund because it has a fixed amount of shares available for purchase, the dividend yields are twice (3.5% vs 7%) what you will find in your average mutual fund. I think we can all agree that more bang for your buck is a good thing.
One CEF that I have had success with goes by the ticker PTY. Currently, the yield for PTY is 9.43%, and the stock trades for $16.55. If I were to invest the $7,000 in my Steemit account into PTY, I would have 423 shares of PTY. At a 9.43% yield, the monthly dividend per share (0.12 cents) would net $50.76.
Consider a 10x example of $70,000, and your monthly income goes to $507.60 - That starts to sound like investment income from a small piece of real estate.
Curating on Steemit and Passive Income
On average, my curation rewards are 10 Steem Power per week. Let’s take that 10 Steem Power, and compare it to a monthly income. 40 Steem Power a month, times $1.25 for Steem brings us to, $50. That is a healthy yield between 9-9.5% by simply pushing a few buttons each day.
However, unlike a CEF, Steem has the potential to double in price in the near term. My friend @financialcritic, wrote a great piece on the trading landscape for Steem to reach $4 in the next 2 months. It is highly unlikely that any CEF is going to double in price during that time. It has taken PTY 5 years to go up 63% from 2012 to present.
Conclusion
The point of all these numbers is to encourage you to vote on Steemit. I vote each day till my voting power sits between 85-90% depending on the number of quality posts I see. You may vote more or less, and that is fine. I am just giving you my example, and a few numbers to show how profitable curating on Steemit is compared to investing in dividend stocks.
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The returns on Steem are amazing for sure....the only issue so far (from my personal experience) is that the volatility is way higher than the stock market. Hopefully in the long term, it recovers and calms down.
That is true. Bitcoin volatility has certainly calmed down over the years - I imagine Steem will do the same providing it keeps going.
Wow..once again nice post with good article from @lydon.sipe
(1) your presentation and written skill is excellent sir....always you have earned my respect.
(2) you have got good command.
(3) I think you have more creative and different idea
(4) I think you have very good tips and tricks about written .....
(5) Thank you so much this post
I have become ur fan.
will be regular reader of ur blog.
Happy steeming....
Cheers!...
Thank you @dinisanda, that is kind of you to say.
Congratulations! This post has been upvoted from the communal account, @minnowsupport, by dinisanda from the Minnow Support Project. It's a witness project run by aggroed, ausbitbank, teamsteem, theprophet0, someguy123, neoxian, followbtcnews/crimsonclad, and netuoso. The goal is to help Steemit grow by supporting Minnows and creating a social network. Please find us in the Peace, Abundance, and Liberty Network (PALnet) Discord Channel. It's a completely public and open space to all members of the Steemit community who voluntarily choose to be there.
This is a well written article on curation reward, I agree with you. As we upvote well establised good authors like you, we should not forget rising stars . Good one indeed, wish you a blessed weekend.
Precisely. Voting for the rising stars is key for the growth of the platform, and it more than pays us in return.
Absolutely, thanks for all your support.
That is very interesting. I have to admit I never payed much attention to curation although I knew it was there in the background.
I hope for a stronger Steem. However, Im not positive in the short term. I did not like the relative weakness compared to Bitcoin recently. I also see Dan powering down 4 million...how much of that will end up going to the exchange, I have no clue.
I thought of you as I was writing this. Our discussions on markets inspired the carryover into Steemit.
Dan is a smart guy, and I doubt he will sell under $2-$3 ( I certainly wouldn't). Like you said though, who knows what all that entails.
The relative weakness compared to bitcoin has been surprising to me as well. Then again, we have a 20% pop today. We keep on working for now, haha.
Yes agreed, Dan IS a smart guy. Thats why when I notice 4 mill plus of SP to be powered down, I pay attention. You know, the whole insider selling not good for equities deal, although I realize he is technically not an insider now. I see he has about 1 mil of liquid steem in the dantheman account...hmm.
I read this and hear wise concern. We both know and have read of the dangers of insider trading. We'll proceed with caution.
stock market or currency market where ever u trade could be a bit shaky and noisy if you dont have skill of trading and can get u in a very inconvenient position at times, it may not be suitable for everyone, however in steemit the time where we are talking right now is the ideal time to bank upon steem, and steem power, steem is going to appreciate to the range of 4 usd by mid 2018 and in addition i can say with steem power u can make some daily certain income. and the latter is the better choice for me.
Thank you and have great day @lydon.sipe
I quite agree. Any trading ought to be approached with caution. $4 Steem continues to look like a
My votes are worth a penny on a good day, but regardless, Id say investing in the right cyrpto beats stock funds or steem power
Thanks on your post @lydon.sipe
Finding that gem can be mighty rewarding.
Thank you for commenting @scalerman.
Give Aragon a check, don't worry about it, tip me later
Thanks for heads up!
I got in at around USD1.25, I am just adding on the way up, best performing coin in my portfolio and the supply is low, so the set up in nice
Nice. Best performing coin caught my attention.
you always do a thorough analysis, lydon. A good post!
Thank you, John.
Amazing! I dont earn nearly that much from curation. Im new maybe I am doing it wrong?
There is a difference in our SP. That influence makes a difference in the reward.
Love this. I would rather do the same, pushing a few buttons every day and curate instead of doing stocks. Btw, until what % your SP before you stop currating for the day?
Good question, I vote till my Voting Power is around 85-88%.
Thanks for answering.
You're welcome.
I see investing on Steem is good because many developers are supporting it and is one of the top cryptos out there because of steemit. Although we are also at the mercy of Dan.
It is a top crypto. We'll keep an eye on Dan's investment.