advantages of share and dividend three points
Answers
Answer:
Step-by-step explanation:
Two ways to profit: With dividend stocks, your return on investment (ROI) increases when share prices rise and when the company pays dividends. With non-dividend stocks, the only way you can earn a positive return is through share price appreciation — buying low and selling high.
Reduced risk: Because dividends give investors two ways to realize a return on their investment, they tend to have a lower risk-to-reward ratio, which you can see in less volatility in the share price. A stock with lower volatility sees smaller share price declines when the market falls. Low volatility may also temper share price appreciation on the way up.
Passive income: Dividends provide a steady flow of passive income, which you can choose to spend or reinvest. This attribute makes dividend stocks particularly attractive to retirees looking to score some supplemental income.