If you have a long-term investment horizon of at least ten years, your best investment is not mutual funds, ETFs, growth stocks, bonds, or gold, but a diversified portfolio of high quality dividend stocks. Here are the steps to build your investment portfolio to achieve the best long term returns.
Understand that stock return = dividend yield + share price growth. For example, a company that pays a 5% dividend yield and appreciates by 5% every year has an annualized 10% total return. High quality is necessary to ensure that the dividend will last and will grow at a satisfactory rate.
Source: WikiHow
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