Beginner here. Was looking at different stock investing strategies, and one that came up was investing in high-yield dividend stocks.
From what I understand, investing in this manner may not get you the greatest returns year after year, but it’s a safe means of investing.
For example, let’s say you invested in 100 shares each valued at $100, for a total initial investment of $10k. And this company had a 10% dividend.
Three things could happen. The markets could go up, down or stay the same.
If the market goes up 10%, then you now have $11k in stocks + 1k in dividends for a total of $12k (gained $2k)
If the market stays the same, you have $10k in stocks + 1k in dividends for a total of $11k (gained $1k)
And if the market drops by 10%, you have $9k in stocks + $1k in dividends for a total of $10k (gained or lost nothing)
Is this a good or recommended safe investing strategy if you plan on holding the same stocks year after year?
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