Dividend Growth Investing Doesn't Get Enough Respect

Dividend Growth investing is one of the most misunderstood investment strategies out there. Yet various studies have proven that quality dividend growth stocks tend to outperform the broad market indices over time. The main obstacle to understanding dividend investing in general is that dividend stocks are equities and not a separate asset class. Companies exist for the benefit of shareholders, which means that they have to generate some return either in the form of dividends or in the form of capital gains. Paying a dividend instills discipline on management to be careful with the cash position and not take excessive risks such as ill-timed acquisitions or investing in projects which might not generate sufficient returns for the company. Investing should be... Read more