“A lot of people love Oreos. So their manufacturer is making money. That means more dividends for shareholders.” -Maria Bartiromo-

It is hard to overstate the importance of dividends when developing an investment strategy. Dividend-paying stocks can generate income and grow income, while offering the opportunity for capital appreciation. In addition, dividend-paying stocks may provide better risk-adjusted returns, including lower volatility and offer some downside protection.

As Lowell Miller, author of the Single Best Investment, says, “The very attention we place on rising dividends puts us squarely in the position of ‘owners’ of a company, of true investors who understand that a satisfying and reasonable return…is the logical and inevitable result of investing in a company that is actually doing well enough, in the real world, to both pay dividends and to increase them on a regular basis.”

The attached piece, prepared by Morningstar, highlights the many benefits of incorporating dividend-paying stocks in an equity portfolio. If you have any questions or would like to learn more, please let us know. We would welcome an opportunity to talk.

 

 

 

 

 

 

Maria Bartiromo is a Financial Journalist, Columnist, and Author