Certain blue chips offer dividends. Mutual funds do as well. The deciding factor is whether or not you opt for a cash payement or re-invest the cash dividends in your fund.

Specifically speaking in refrence to my portfolio, my shares of my stocks are sent with a cash payment each time the board approves a dividened. With my mutual fund, I opt for re-investment to add a higher return on investment and having the idea that this mutual fund will initially be used as a retirement fund and love the re-invest option to accumulate wealth in that fund.

When I choose to buy a stock, one of my main criteria is the history of dividend payments that the company has offered. Disney has a strong record of dividend payments as long as the company has been public and thats why Disney along with Microsoft is in my portfolio.

Long term dividend investment strength is the key to a great return on investment if you choose to have either stocks or mutual funds due to the long term period in which you will own the stocks in your portfolio, a great key trading idea for the long term investor.

If you liked this post, please subscribe to Money Management And You's RSS feed.

Filed under: Investments