This funding technique focuses on corporations with a historical past of persistently growing dividend payouts. It emphasizes not solely the present yield but in addition the potential for future dividend development, aiming to seize each earnings and worth appreciation. As an example, an organization that has raised its dividend yearly for the previous ten years whereas additionally exhibiting sturdy earnings development can be a chief candidate.
Focusing on corporations with this profile gives a number of potential benefits. Rising dividends can present a hedge towards inflation and contribute to compounding returns over time. Moreover, the self-discipline of persistently elevating dividends usually alerts a financially wholesome and well-managed firm. Traditionally, this funding method has demonstrated the potential to ship aggressive long-term efficiency.
