More Myths About Dividend Growth Investing

Posted by D4L | Tuesday, March 20, 2012 | | 0 comments »

This past weekend's article on myths about dividend growth investing proved very popular, so here is another installment. As with the first article, these are my personal views. Not everyone goes about dividend growth investing in exactly the same way, nor do all of us have exactly the same goals. But within the "big tent," there is general agreement on core principles. The purpose of these two articles is to foster more understanding about the dividend growth strategy and to encourage useful discussions about it.

Myth #10: Dividend growth investors select stocks based only on yield; dividend growth investing = high-yield investing. This is another myth with origins outside the dividend growth community. I have seen it stated that dividend growth investors look "only at yield" in selecting stocks. I have also seen the term "dividend growth investing" morph into "high yield investing" when it is being discussed by someone who does not use (and apparently does not grasp) the strategy. Both of these mistakes suggest a basic misunderstanding of what most dividend growth investors actually do. Most dividend growth investors I know use a variety of factors to select the stocks they want in their portfolios.

Source: Seeking Alpha

Related Articles:
- Increasing Dividend Yield Part VI: Time
- Increasing Dividend Yield Part V: MLPs
- Increasing Dividend Yield Part IV: Bonds
- Increasing Dividend Yield Part III: Preferred Stock
- Increasing Dividend Yield Part II: REITs

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