Dividend Stock Myths
High dividend stocks are boring.
Perhaps—in the sense that a fine meal, a good night’s sleep, or a smooth-running car is boring. Honestly, if you’re looking to your stocks for excitement, you’ll almost have to be very lucky, or very disappointed. Between you and I—I just don’t feel that lucky.
High dividend stocks are underperformers.
I don’t know how to say it more plainly. For those who reinvest dividends long-term, there is plenty of evidence that this argument is simply the opposite of the truth. Don’t get me wrong. Any stock can under perform, but that is an argument for diversification, not an argument against high dividend stocks.
High dividend stocks are for widows and orphans.
And for everyone else! At least for everyone who values total return.
If they were so good for me my broker would recommend high dividend stocks.
Really? Is it in your broker’s interest for you to invest in perhaps 10-20 different stocks and leave your portfolio alone for years? Not if he’s paid by stock sale/purchase commissions.