Investing In Dividends For Dummies E-Book

Lawrence Carrel

• Herausgeber: John Wiley & Sons
• Kategorie: Fachliteratur
• Sprache: Englisch

Seitenzahl: 372

Veröffentlichungsjahr: 2015

Beschreibung

Get the lowdown on adding dividend stocks to your investment portfolio Investing In Dividends For Dummies shares the fundamental information you need to know about one of the steadiest investments you can make: dividends. This approachable resource provides you with the details necessary to make confident, educated decisions regarding the dividends that you choose to add to your portfolio. Instead of guessing which investments will complement your current strategy, leverage the information offered by this easy-to-use text to determine how to best incorporate dividends into your investment tactics--and do so with confidence. The steady nature of dividends makes them appealing to investors for many reasons. Most notably, they're a great option if you're entering retirement and want a reliable source of income. Additionally, dividends are fantastic components of a well-rounded investment portfolio, as even the most aggressive of investors can benefit from more conservative investment tools in their overall strategy. Understanding what dividends are and how to use them is the first step to adding them to your portfolio. * Explore how dividend stocks can fit into your current investment portfolio--and how they will impact your portfolio's performance * Effectively research the companies offering dividends, and pinpoint the ones that best complement your current portfolio * Gauge the risk, growth, and return offered by dividend opportunities * Increase the amount of your investment portfolio that's dedicated to dividends, depending upon your financial goals and portfolio needs Investing In Dividends For Dummies is a fantastic resource if you're looking to find a mature and predictable way to invest your money!

Leseprobe

Investing in Dividends For Dummies®

Published by: John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030-5774, www.wiley.com

Copyright © 2016 by John Wiley & Sons, Inc., Hoboken, New Jersey

Published simultaneously in Canada

No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning or otherwise, except as permitted under Sections 107 or 108 of the 1976 United States Copyright Act, without the prior written permission of the Publisher. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, [phone], fax [phone], or online at http://www.wiley.com/go/permissions.

Trademarks: Wiley, For Dummies, the Dummies Man logo, Dummies.com, Making Everything Easier, and related trade dress are trademarks or registered trademarks of John Wiley & Sons, Inc., and may not be used without written permission. All other trademarks are the property of their respective owners. John Wiley & Sons, Inc., is not associated with any product or vendor mentioned in this book.

LIMIT OF LIABILITY/DISCLAIMER OF WARRANTY: THE PUBLISHER AND THE AUTHOR MAKE NO REPRESENTATIONS OR WARRANTIES WITH RESPECT TO THE ACCURACY OR COMPLETENESS OF THE CONTENTS OF THIS WORK AND SPECIFICALLY DISCLAIM ALL WARRANTIES, INCLUDING WITHOUT LIMITATION WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE. NO WARRANTY MAY BE CREATED OR EXTENDED BY SALES OR PROMOTIONAL MATERIALS. THE ADVICE AND STRATEGIES CONTAINED HEREIN MAY NOT BE SUITABLE FOR EVERY SITUATION. THIS WORK IS SOLD WITH THE UNDERSTANDING THAT THE PUBLISHER IS NOT ENGAGED IN RENDERING LEGAL, ACCOUNTING, OR OTHER PROFESSIONAL SERVICES. IF PROFESSIONAL ASSISTANCE IS REQUIRED, THE SERVICES OF A COMPETENT PROFESSIONAL PERSON SHOULD BE SOUGHT. NEITHER THE PUBLISHER NOR THE AUTHOR SHALL BE LIABLE FOR DAMAGES ARISING HEREFROM. THE FACT THAT AN ORGANIZATION OR WEBSITE IS REFERRED TO IN THIS WORK AS A CITATION AND/OR A POTENTIAL SOURCE OF FURTHER INFORMATION DOES NOT MEAN THAT THE AUTHOR OR THE PUBLISHER ENDORSES THE INFORMATION THE ORGANIZATION OR WEBSITE MAY PROVIDE OR RECOMMENDATIONS IT MAY MAKE. FURTHER, READERS SHOULD BE AWARE THAT INTERNET WEBSITES LISTED IN THIS WORK MAY HAVE CHANGED OR DISAPPEARED BETWEEN WHEN THIS WORK WAS WRITTEN AND WHEN IT IS READ.

For general information on our other products and services, please contact our Customer Care Department within the U.S. at 877-762-2974, outside the U.S. at 317-572-3993, or fax [phone]. For technical support, please visit www.wiley.com/techsupport.

Wiley publishes in a variety of print and electronic formats and by print-on-demand. Some material included with standard print versions of this book may not be included in e-books or in print-on-demand. If this book refers to media such as a CD or DVD that is not included in the version you purchased, you may download this material at http://booksupport.wiley.com. For more information about Wiley products, visit www.wiley.com.

Library of Congress Control Number: 2015951277

ISBN 978-1-119-12195-4 (pbk); ISBN 978-1-119-12197-8 (ebk); ISBN 978-1-119-12198-5 (ebk)

Investing in Dividends For Dummies®

Visit www.dummies.com/cheatsheet/investingindividends to view this book's cheat sheet.

Table of Contents

Cover

Introduction

About This Book

Foolish Assumptions

Icons Used in This Book

Beyond the Book

Where to Go From Here

Part I: Getting Started with Dividends

Chapter 1: Wrapping Your Brain Around Dividend Investing

Coming to Terms with Dividend Stocks

Prepping Yourself for the Journey Ahead

Selecting First-Rate Dividend Stocks

Building and Managing Your Portfolio

Checking Out Various Investment Vehicles

Chapter 2: Brushing Up on Dividend Details

The Major Stock Market Indexes

The Difference Between Common and Preferred Stock

Company Fundamentals

Paying Tribute to Yields

The Role Dividends Play in the Market

Important Dates in the Life of a Dividend

Chapter 3: Grasping the Dividend Advantage

The Pros and Cons of Investing in Dividend Stocks

Investing in Solid Companies

The Rise and Fall of Dividend Stocks’ Popularity

Part II: Exploring the World of Dividends

Chapter 4: Income-Generating Industries

Lighting Up Your Portfolio with Utilities

Assessing Utility Companies: What to Look For

Pumping Up Your Portfolio with Energy Partnerships

Exploring Master Limited Partnerships

Exploring Telecommunications Stocks

Assessing Telecom Stocks: What to Look For

Discovering the Consumer Goods Sector

Identifying a Good Consumer Staples Stock

Chapter 5: Exploring REITs and Financials

REIT Basics

Evaluating REITs

Dividends from Banks

Chapter 6: Dividend Investment Vehicles

The Nature of DRIPs and DIPs

Diversifying Your Dividends through Mutual Funds

Investing in Dividend-Focused Mutual Funds

The Best of Both Worlds: Exchange-Traded Funds

Dividends from ETFs

Shaking WisdomTree’s Family of Dividend Funds

Going Global with Foreign Dividends

Examining Ways to Go Global

Part III: Selecting an Investment Approach

Chapter 7: Setting Goals and Making Plans

Your Personality Profile

Formulating an Investment Plan

Planning Specifically for Retirement

Chapter 8: Risky Business: Assessing Risk and Your Risk Tolerance

Weighing Risk and Reward

Gauging and Raising Your Risk Tolerance

Recognizing Factors That Can Increase Risk

Mitigating Your Risks

Chapter 9: Choosing Your Approach — And Your Dividends

Finding the Right Investing Approach for You

Sizing Up Potential Picks

Calculating a Dividend’s Relative Strength

Recognizing a Potentially Good Dividend Stock

Chapter 10: Buying and Selling Dividend Stocks

Deciding Between a Full-Service and Discount Broker

Choosing a Full-Service Broker

Finding a Discount Broker

Buying and Selling Shares

Chapter 11: Staying Current on Tax Laws

Dividend Taxation

The Tax on Dividends from Mutual Funds

The Tax on Dividends from ETFs

MLP and REIT Taxation

Calculating Your After-Tax Returns

Part IV: The Part of Tens

Chapter 12: Ten Common Misconceptions about Dividends

Dividend Investing Is Only for Old, Retired Folks

I Can Get Better Returns with Growth Stocks

Dividend Stocks Are Safe Investments

Companies Limit Their Growth by Paying Dividends

Paying Down Debt Always Comes Before Paying Dividends

Companies Must Maintain a Stable Dividend Payout

My Dividend Increases Won’t Even Keep Up with Inflation

All Dividends Are Taxed at the Same Rate

You Should Always Invest in High-Yield Stocks

REITs and Bank Stocks Are No Longer Good for Dividends

Chapter 13: Ten Dividend Investing Mistakes to Avoid

Buying a Stock Solely on a Hot Tip

Skipping Your Homework

Expecting to Buy and Sell Shares Just for the Dividend

Focusing Solely on Yield

Focusing on Current Rather than Future Dividends

Failing to Monitor Stocks and the Market

Buying a Stock Just Because It’s Cheap

Holding a Poor-Performing Stock for Too Long

Failing to Account for Taxes

Giving Too Much Credence to Media Reports and Analysis

About the Author

Cheat Sheet

Advertisement Page

Connect with Dummies

End User License Agreement

Guide

Cover

Table of Contents

Begin Reading

Pages

iii

iv

vii

viii

ix

x

xi

xii

xiii

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

27

28

29

30

31

32

33

34

35

36

37

38

39

41

42

43

44

45

46

47

48

49

50

51

52

53

54

55

56

57

59

60

61

62

63

64

65

66

67

68

69

70

71

72

73

74

75

76

77

78

79

80

81

82

83

84

85

86

87

88

89

90

91

92

93

94

95

96

97

98

99

100

101

102

103

104

105

106

107

108

109

110

111

112

113

114

115

116

117

118

119

120

121

122

123

124

125

126

127

128

129

130

131

132

133

134

135

136

137

138

139

140

141

142

143

145

146

147

148

149

150

151

152

153

154

155

156

157

158

159

161

162

163

164

165

166

167

168

169

170

171

172

173

174

175

176

177

178

179

180

181

182

183

184

185

186

187

188

189

190

191

192

193

194

195

196

197

198

199

200

201

202

203

205

206

207

208

209

210

211

212

213

214

215

216

217

218

219

220

221

222

223

224

225

226

227

228

229

230

231

232

233

234

235

236

237

238

239

240

241

242

243

244

245

247

248

249

250

251

252

267

268

269

270

271

272

273

274

Introduction

The purpose of the stock market is to enable companies to raise the capital they need to start or grow their businesses. Instead of borrowing money from a bank and paying interest on it, a company can sell shares of itself to investors. Over the years, the stock market has gone from being a respectable venue for investors to purchase partial ownership in companies to something more akin to a casino. Seduced by reports of individuals earning millions nearly overnight by investing in high-growth stocks, speculative investors poured money into many companies that offered nothing more than a promise of sales and profits, further inflating share prices. When the needle point of reality finally popped the bubble, the poor unfortunates who failed to cash out their chips early enough were blown away like dust.

Fortunately, the deflated bubble (along with some dividend-friendly tax legislation) brought many investors down to earth and back to the basics — investing in companies with a proven track record of earning profits and paying dividends. As they return to the fold, investors are beginning to realize what their parents, grandparents, and great-grandparents already knew — dividend investing offers a host of benefits that provide a safer and often more profitable way to invest in the stock market.