West Loop Financial LLCInvestors Too Focused On Dividends – West Loop Financial LLC https://www.westloopfinancial.com Evolutionize Site Wed, 19 Aug 2020 20:50:49 +0000 en-US hourly 1 https://wordpress.org/?v=5.1.22 Investors Too Focused On Dividends https://www.westloopfinancial.com/2014/08/25/investors-too-focused-on-dividends/ https://www.westloopfinancial.com/2014/08/25/investors-too-focused-on-dividends/#respond Mon, 25 Aug 2014 09:00:52 +0000 http://evolvemypractice.com/?p=1262 Despite the fact that financial theory has long held that dividend policy should be irrelevant to stock returns, one of the biggest trends in recent years has been individual investors rushing to buy dividend-paying stocks. In some cases, it’s a substitute for safer, but lower-yielding bonds. In others, it’s because investors believe dividend-paying stocks are...

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]]> Despite the fact that financial theory has long held that dividend policy should be irrelevant to stock returns, one of the biggest trends in recent years has been individual investors rushing to buy dividend-paying stocks.

In some cases, it’s a substitute for safer, but lower-yielding bonds. In others, it’s because investors believe dividend-paying stocks are simply better investments. For example, the SPDR S&P Dividend ETF (SDY | A-71) now has $12.4 billion in assets under management, and the Vanguard High Dividend Yield ETF (VYM | A-94) has grown to about $8.6 billion.

With this recent popularity in mind, I thought it would be interesting to examine the difference in returns on the stocks within the S&P 500 that pay dividends and the ones that don’t.

Read the rest of the article on ETF.com.

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