Dividend Stocks Offer Numerous Advantages

It is significant for the stock investor to take into account the benefits that dividend offers and how painless it is to add dividend-paying stocks in any portfolio. Let us have a look at some of numerous advantages that dividend paying stocks offer:

1. Dividend stocks offer attractive returns as the amount paid is part of total return. Therefore, companies that pay dividends are generally historically stable. 2. Less volatility is another advantage of such stocks as dividends helps reduce the possible decline of a company’s stock price, thereby reducing volatility. 3. Dividends become an income source (however they are only a small part of an investment’s total return). 4. Dividend stocks provide favorable tax treatment.

Source: Potential Trader

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