Dividend Investing Does Work

Written by The Dividend Guy on July 7, 2006

Bill Cara over at billcara.com has posted an interesting bit of researchcompleted by Bear, Stearns, and Co. I found this statement especially interesting:


What’s more, we have found that during backdrops in which economic growth prospects wane, the dividend-paying universe stands out as a particularly effective investment theme. Year to date, the dividend-paying universe has delivered an average performance of 1.89% compared to the non-dividend-paying universe, which on average declined by 0.78% since the beginning of the year.

The article focuses on S & P’s group of companies they call the “Aristocrats” - companies that have increased their dividends consistently over the past 25 years. It goes in depth on how an investor can read economic data to enhance returns but I started to gloss over with that. I think the important thing to note is the reaffirmation that dividend investing does work, and looking for companies that consistently increase and pay dividends can be a very effective way to enhance returns. At least I hope so….


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1 Comment so far

  1. Tim MMF July 7, 2006 1:56 pm

    Yeah, I love dividend stocks. Great article!

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