The continued challenges and slow down in various sectors of the economy is putting stress on dividends paid by many corporations. During year 2008 and so far in 2009, investors have had to experience dividend reductions and/or dividend cuts, thereby affecting their continued dividend income. My dividend portfolio was also affected by dividend elimination/reductions by C, BAC, and PFE. In order to minimize the risk of dividend reduction/elimination from each stock, I have been using the pre-determined maximum limit of 5% of total dividends. This method does not provide a means to measure the changes in risk-to-dividend on continued basis. Therefore, I have come up with the method that I have started using for my dividend portfolio. Here I am discussing a measure of risk-to-dividends, which can be used by individual dividend investors. continue reading rest of the article….
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Ignore Smaller Ones at Your Peril
What is the common thread that we see in today’s environment? Weather it is business environment, economic environment, media environment, global socio-economic-political environment, all that we see/hear/read about is big news, large impact, and huge stimulus. Everything thing that happens or is happening some how manifests itself in “pseudo big”. In our quest for looking at every issue as being “big”, we fail to observe or do not see the smaller ones. The smaller ones (aspects, news, issues, situations, etc.) go unnoticed or are ignored with the tag of being insignificant. Similarly, in the world of investing and big capital gains, the dividends are deemed to be small cousins and hence comfortably ignored. In one of my recent post, I showed how there are 205 corporations that are raising dividends but it does not get coverage because few big corporations occupy the limited media space. continue reading rest of the article….