Episode Description
If you want to outperform the S&P500 AND the TSX, You need to stop buying high dividend paying stocks and instead buy stocks that grow their dividends each year.
I’m going to tell you the 13 best dividend paying & growing stocks that you need to have in your portfolio today! And just so you know – by holding these stocks over the last 10 years, you will have earned an annualized return of 12% year over year. This means you would have outperformed the Canadian Stock Market (TSX) and the US Stock Market (S&P500) as a whole!
Dividends are part of the profits that a company pays out to their share holders, as a way of returning to them some of the funds that they contributed to the company. High Dividend payments indicate that a company has earned massive profits and have little to no expectation of large reinvestments into the company’s operations – we call these cash cows.
Low dividend payers generally indicate that they are making profits and would like to provide their investors with some sort of rewards, while also signalling that the profits they’ve made are going to be directed into the future growth of the company. We call these dividend growers.
Dividend Growers are my favorite form of investment holdings because they constantly pay me a passive cashflow on my monies invested – and because they’ve continually reinvested their funds into their company, their stock prices tend to skyrocket as they continue to grow over the course of 5 – 10 years.
This is the method I’ve used to create a portfolio that generates a 3.70% dividend yield – which is guaranteed pay out of income each year, while also averaging a 12% return on investment through increases in the value of my holdings.
Dividend paying stocks are great investment ideas for people looking for a steady stream of income while also benefitting from the ongoing returns within the markets. Its important to be picky when it comes to choosing individual stocks as their business models and industries can affect the dollars that you make on your portfolio. If you copy the 13 holdings that I’ve listed in this video, while maintaining a dividend reinvestment plan & annual rebalancing strategy, you will earn a 3.70% dividend yield on your portfolio and likely, outperform the stock market index based on the value approach that we’ve taken in assessing these holdings.
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