What you should look for in addition to the dividend yield


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"The higher the dividend yield, the better!" In principle, this principle is true. But you'd better not rely on the dividend yield alone when selecting high-dividend stocks. Because this key figure also increases when the share price is low. It is therefore possible that you will use the dividend yield to select stocks with low share prices and poor prospects for your portfolio.

You should therefore also pay attention to the following points when you are looking at dividend stocks:

    Payout ratio: How much of the profit does the company in question distribute to its shareholders? You don't need to worry about distributions of up to 60 percent. Anything above that, however, should make you skeptical. After all, a company that pays out too much lacks reserves for future investments. That blocks future opportunities and growth potential!
    Regularity of dividends: Prefer companies that pay a dividend regularly, at least once a year. You should not necessarily shortlist companies with dividend-free years as dividend stocks.
    Earnings growth: Without earnings, the best dividend is of no use. Prefer solid companies whose profits have grown rather than shrunk in recent years. Individual stagnations or declines due to a sluggish economy can be tolerated. But profits should rise over the long term.

Funds also pay dividends

If you want to include high-dividend stocks in your portfolio and you are willing to take rather moderate risks, you should think about high-dividend stock funds (also called dividend funds). These can minimize the risk - of a fall in the price of individual shares - even with a low capital investment. Especially against the background of the current low interest rates of conservative investment options, such as federal bonds or call money accounts.

Skeptical about shares?

As mentioned at the beginning, many investors are not aware that shares in exness types of accounts are not worthwhile just because of speculation on price gains. This is shown, among other things, by Germany's largest direct bank study as part of the "Aktion pro Aktie" campaign. It uncovers misinformation and refutes it.

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How exactly do you actually find high-dividend shares?

You can find high-dividend stocks for your securities account by adding the "dividend yield" filter in the bank securities search. You can then research other key figures such as payout ratio and earnings growth in the share price snapshot.

Conclusion: Dividend stocks can be worthwhile

Dividend stocks are worthwhile, but only if you choose them carefully. In addition to the dividend yield, you should also consider the payout ratio (max. 60 percent), the regularity of the payouts and the earnings growth. This will ensure that you don't back the wrong horse.