The Dividend Investor

One major reason to buy stock in a company is to own a share of that company’s profits, which are often paid out in the form of dividends. While this may seem obvious, many investment funds and platforms have come to emphasize measures of performance that prioritize other components in the total return to a stock investor, namely price appreciation. Dividend investing can be seen as a “back to basics” approach that re-prioritizes the dividends a stock is expected to pay as a source of future returns over more speculative expectations around possible price changes. This chapter explains dividend investing and its relationship to factor investing, concentrated business ownership, and being a landlord, along with some unique advantages and critiques of this way of investing.