Get 40% Off
👀 👁 🧿 All eyes on Biogen, up +4,56% after posting earnings. Our AI picked it in March 2024.
Which stocks will surge next?
Unlock AI-picked Stocks

The #1 Undisputed Investing Strategy

Published 05/08/2017, 10:00 AM
Updated 05/14/2017, 06:45 AM

There’s a very good reason why we cover stocks so extensively here at Wall Street Daily.

The stock market represents the single best way for investors to build wealth.

As you know, we focus our efforts on uncovering the market’s most innovative and disruptive small-cap companies — primarily in the tech space.

But we also keep a close eye on these firms as they grow up into large caps with treasure chests full of cash.

That’s because sooner or later, they’re going to start paying dividends. And it’s a hardly disputed fact that dividend-paying stocks outperform nondividend payers over time.

Not by a little, but by a whole lot…

According to data crunched by famed economists Eugene Fama and Kenneth French, dividend-paying issues have beaten out nonpayers by as much as 1.9% on a total return basis over the last 90 years.

Heck, Warren Buffett — one of the greatest investors of all time — will hardly look at a stock that doesn’t pay a dividend.

On such merits, I asked my team of analysts to put together a video on the awesome wealth-building power of dividend stock investing.

I know you won’t be disappointed.

Transcript of Video:

Dividend investing is a great way to get a good bang for your buck.

It’s a go-to strategy for income investors since it’s a safe, reliable way to invest in major Fortune 500 companies and grow your investments over time.

For those who don’t know what a dividend is, it’s simply a payment a company makes to investors as a distribution of profits. Often investors take this payment and reinvest it back into the underlying company, which can result in increased returns and dividend payments in the future.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

It certainly pays to be a dividend investor…

Our researchers at Wall Street Daily did some digging and discovered some interesting facts about dividend investing…

Consider that over the last 10 years, the S&P has returned 261% as a whole. Pretty good, right? $10,000 invested would have become $26,100.

Well, when you consider that if you focused on JUST the dividend-paying companies, you would have returned 500% — turning that same $10,000 into $50,000. And that’s not even factoring in reinvesting those dividends back into the companies.

Of course, being a successful dividend investor isn’t quite as simple as buying a dividend-paying stock and sitting back while your fortune grows; if it were, we would all be millionaires.

After all, 81% of the stocks on the S&P 500 pay dividends.

So it takes a lot of research to know if A) a company is paying the right amount back to shareholders… and B) you’re investing in a stable company that not only has a history of increasing its dividend but will likely continue to pay its dividend going forward.

I mention that because… something interesting happens if you only look at the dividend-paying companies that have increased their dividend payments every year for at least 10 years. A basket of those companies would have returned 1,171%, turning that initial $10,000 investment I mentioned before into $117,100.

Original post

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.