Dividends Part 2 with Kevin Ellman CFP®
I have observed over many years that the high-quality, high dividend stocks tend to be less volatile than growth stocks that don’t pay dividends. They can provide more of a steady Eddie kind of income. Critics often point out that companies that distribute their profits in the form of dividends instead of reinvesting those profits back into the company tend to display slower growth. This is probably true. The fact that they are a less exciting investment to me makes them more attractive. I really don’t want any nasty surprises.
I have observed amongst my clients that own high dividend stock portfolios a more relaxed attitude about their investments. Of course this strategy is not for everyone and not for the entire portfolio, but if the words high-quality, high dividend and lower volatility sound attractive to you then you should explore this strategy more thoroughly. Keep in mind that no strategy regardless of how intelligent, disciplined or conservative it may sound guarantees a result.
Asset allocation does not protect against loss of principal due to market fluctuations. It is a method used to help manage investment risk. Past Performance does not guarantee future results. This material is for informational purposes only and is not meant as Tax or Legal advice. Please consult with your tax or legal advisor regarding your personal situation. The opinions expressed are subject to change with economic and market conditions. They are not meant as investment advice. Forward looking statements and market forecasts cannot be guaranteed and may not come to pass.