http://www.canadiancapitalist.com/more-reasons-to-love-dividends/ Helping you invest and prosper Sun, 12 Feb 2012 00:54:40 +0000 hourly 1 http://wordpress.org/?v=3.3.1 http://www.canadiancapitalist.com/more-reasons-to-love-dividends/#comment-144746 Dividend Growth Investor Sat, 26 Jul 2008 22:17:37 +0000 http://www.canadiancapitalist.com/2006/05/30/more-reasons-to-love-dividends#comment-144746 I agree that management typically doesn't know how to reinvest profits back to the business. Thus they should reward shareholders for risking their hard earned money by giving them dividends. It's that simple. Otherwise, if management forgot that they should be working for the shareholders, they would do large risky bets which could only profit exectuvies compensations.. But would actually detract from long-term value of the corporations they are serving! I agree that management typically doesn’t know how to reinvest profits back to the business. Thus they should reward shareholders for risking their hard earned money by giving them dividends. It’s that simple.
Otherwise, if management forgot that they should be working for the shareholders, they would do large risky bets which could only profit exectuvies compensations.. But would actually detract from long-term value of the corporations they are serving!

]]> http://www.canadiancapitalist.com/more-reasons-to-love-dividends/#comment-3556 Phil S Sat, 03 Jun 2006 16:59:47 +0000 http://www.canadiancapitalist.com/2006/05/30/more-reasons-to-love-dividends#comment-3556 You forgot a third scenario. Leveraged investors like me need to buy dividend paying stocks in order to lessen or eliminate the pain of the interest payments on the money borrowed to buy the stocks. It's obviously a big gamble that is not for faint of heart as a distribution cut kills both the ability to pay down the interest as well as original investment value - so the downside risk is at least as large as the upside potential. You forgot a third scenario. Leveraged investors like me need to buy dividend paying stocks in order to lessen or eliminate the pain of the interest payments on the money borrowed to buy the stocks. It’s obviously a big gamble that is not for faint of heart as a distribution cut kills both the ability to pay down the interest as well as original investment value – so the downside risk is at least as large as the upside potential.

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