Article by: Nipapan Poonsatiansap CFP® Independent Finance Planner
When talking about the stock market Most investors often think of it as a lucrative business in order to get the fastest profit. That may not be the right strategy for long-term investment. If you want to create sustainable wealth. You have to let money works for you. And one of the strategies to invest money to work for us is to invest in stock dividend
Why invest with stock dividend?
The principle of investing in a stock that investors often forget is investing in stocks is an investment in a business. No matter what business it is. It is a business that operates with managers, employees, customers, products and services. The only hope is that the profits from the business. (It's not just the 3-4 characters you will print in Settrade, just to check stock prices.) What we will get as a return on equity is dividends, if we choose to invest in good business. Highly competitive business will be profitable and continue to grow. That will be able to increase the wealth to the shareholders quite well.
In addition, investment in stock dividend can beat inflation. The basic inflation in Thailand's economy is about 3% per year. If we consider that investment in stocks is an investment in the business. When we invest in good business. The business expects growth. On average, the growth rate of a good company is often more than inflation.
It's been a long time since the founding of the Stock Exchange of Thailand. Investing in stocks gives you an average return of 5-10% per year, which can be easily beaten by inflation.
How do we invest in stock dividend?
Stock dividend selection Three major factors are considered to select stock dividend
So what investors should do is study the business (stock) we want to invest. Assess future profitability trends which is the best signal to say that the company has a chance to pay dividends continuously? And keep track and investigate our investments consistently. If this is done. Your next stock dividend will have a higher chance of success.