Dividend Investing
Companies that return cash to shareholders on a regular schedule.
Dividends are cash payments funded by company profits. A sustainable payout ratio matters far more than a headline yield.
Dividends are cash payments funded by company profits. A sustainable payout ratio matters far more than a headline yield.
Reinvesting dividends compounds returns; taking them as income turns a portfolio into a paycheck.
Key concepts to master
- 01.Total cost of ownership, including fund fees and platform fees
- 02.Liquidity: when, and on what terms, you can get your money back
- 03.Tax treatment and which account type this belongs in
- 04.How this exposure overlaps with what you already own
Common mistakes
- ×Sizing a position based on recent performance rather than a written plan
- ×Confusing infrequent valuation with genuine stability
- ×Ignoring the tax drag of frequent trading in taxable accounts