Dividend Stock as part of Your Investment Plan

dividend-stockIn this article, i shall discuss on my favorite type of stock which is dividend stock, and why i love to have these darling in my Investment Portfolio!

Type of Stocks

I will broadly classified stocks namely as the following:

-Capital Appreciation Stock (time frame of Mild to Long term holding)

Capital appreciation (CA) is the increase in the value of an investment/trading that you make. You will get CA when you get a profit of the difference between the purchase and sale price of the stock and less of the purchase and sale commission costs.

It may required a time frame from months to years of stock holding before you gain from a decent CA. And of course, it will required some commitment from you to get the education on certain skillset, experience and monetary strength in order to pick the winning stock.

-Dividend Stock (time frame of Mild to Long term holding)

Some corporate has the history to distribute their earnings to company shareholders in the form of Dividend. It could take place as Stock or Cash distribution form (Dividend yield). And do take note, that some company distribute Dividend on a regularly basis (quarterly), while some only take place once in every two years or longer. Please do your research on their distribution interval.

On general, such stock will required from months to years holding, since investor are focused on the regular Dividend.
-Penny Stock (time frame of Short to Mild term holding)

Penny Stocks are what we label as the Small-capitalization equity shares. There are plenty different way of how investor/trader classified penny stock. Some based on their total value of stock shares market capitalization whiles other just on their per share values. For me, i just take those that being trading below twenty cents as Penny Stock.

As Penny Stock being priced extremely low, it make relatively easy for individual to purchase large quantities of shares with the aim of quick profit, during rapid price movements. As a result, it make Penny Stock extremely volatility and considered to be highly speculative type of stock.

 

3 Top Reasons why i love Dividend Stocks to be in my Investment Portfolio.

After discussing briefly on the different type of stocks out there, readers out there should have a better understanding of them. If you still get confused, do invest some time and effort to educate yourself over it. It’s what you do during your free time to make yourself more wealthier.

-Dividend
Dividend stock as what it name implied; to distribute in the form either Stock or Cash reward to their royal company shareholder regularly. It always better to invest in such type of stock with a good Yield than to park all your money in Bank Account or Fixed Deposit with a low interest rate. And you can bet that you be feeling happy to receive statement showing regular decent payment into your investment plan, as you are building your Big Fat Pillar!

 

payout-Stable
As most of us will be busy with our Day Job and focusing our energy and time in our Career and Family and other commitment in Life, we may not have enough time to keep a lookout for our Investment Portfolio everyday, unless you got a reliable Personal Stock broker. Dividend stock will be the perfect solution for that. Reason being that those royal company shareholder tend to be long term investors, and you can expecting much lower volatility, lower stock price swing. Besides that, they tend to be more stable than other type of stocks especially when in time of uncertainly in stock market due to their dividend nature that cushion the fall.

 

CA-Capital Appreciation

Another main reason why i consider them as darling for any investor, there is a high probability  of Capital appreciation (CA) over the years during the Stock Market Bull period. History has proven it and it will just repeat again in the future.

 

 

 

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Disclaimer
:

All analysis are based on my own personal point of view and experience and it should not be used as a decision to solicit buy/sell activity.

And purpose of this article is written in mind for main purpose of knowledge sharing & discussion, never to induce or promote any insider trading or manipulation activities.

The owner will not be liable for any errors or omissions in this information nor for the availability of this information.

The owner will not be liable for any losses, injuries, or damages from the display or use of this information.

Fredrick Lim

author: 

I started bigfatpillar.com to share some of my ideas, concept or thinking along the way as i'm building my own Big Fat Pillars in area like Financial, Health, Family, Spiritual of my life. In short, making our money work harder in Wealth Creation, Preserve and Improvement.

And i will definitely much appreciate all constructive comments/suggestion/advise to enhance our this Big Fat Pillars in our life.

2 thoughts on “Dividend Stock as part of Your Investment Plan

  1. a growth stock and a dividend stock are the same. they are an entity. there are entities that contain the best of these characteristics.

    the dividend stocks you said, are usually low growth but there are still growth.

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