What is this stuff?

Dividend investing is about owning businesses that will pay you.  The best dividend stocks pay rising dividends year after year. These are typically well known businesses with long dividend histories.  This is a link to the Dividend Aristocrats.  A group of stocks that have paid and increased their dividend for 25 or more consecutive years.

Of primary importance for new DIY investors is the need to understand that dividend payments are a distribution of company profits back to their shareholders. Dividend payments are typical of more mature companies who hope to make up for less movement in their stock price with these quarterly payments whereas growth oriented companies will plow their profits back into the company (in the form of research and development or new facilities) to drive their stock valuation higher.

Simple explanation of dividends

Simple explanation of dividend yield

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