Dividend Capture vs. Buy-and-Hold Dividend Investing: Different Goals, Different Tools

See this debate constantly, so let's clarify: these aren't competing strategies. They serve different purposes.

Buy-and-hold dividend investing:

• Goal: compound wealth over decades

• Benefits from qualified dividend tax rates

• Focuses on dividend growth stocks (companies raising payouts annually)

• Less time-intensive

• Suitable for retirement accounts

Dividend capture trading:

• Goal: generate shorter-term income from capital

• Requires active management and research

• Works best with larger account sizes (to offset costs)

• Tax-inefficient unless in tax-advantaged accounts

• Can be combined with options strategies for hedging

Where dividend capture might fit:

Some traders use it as a supplemental strategy—capturing dividends on stocks they'd hold anyway during flat market periods, or specifically in IRAs where tax treatment doesn't matter.

Others use covered calls alongside dividend capture to generate additional premium.

My take: Neither is universally "better." Your account size, tax situation, time availability, and goals determine which makes sense.

Which approach are you focused on? Anyone combining both?