Single biggest reason why I bet on dividend stocks

Hello, my name is Aleš. I’m co-founder of dividend.watch responsible for the product design of this website. I want to share my biggest argument why I decided to invest mainly into dividend stocks and what was essential idea behind building dividend.watch.

These are strange times in investing. Cryptocurrencies, or hyper-growth stocks like Tesla, can bring you annual returns around 100% to 400%. Why would you invest in boring big companies that pay stable dividends and their growth is more like 5% or 10% per year plus some dividends?

Don’t get me wrong, I like crypto. I like exciting stocks that can skyrocket to the moon because of one tweet. In recent years, I have bought many things from Tesla, Palantir, Dogecoin, Bitcoin, Shiba Inu coin, crashing Boeing stocks and other stuff. I’m not gonna lie, I’ve mostly made money with these shots in the darkness. But it was more luck than anything else. When looking back on my portfolio after a few years, I realized that most pleasure I’m getting from stocks I’m holding from start of my investing, such as Abbvie, Johnson & Johnson and JPMorgan. Why is that?

I’ve realized that investing is not about mere financial return; it’s about managing risk and return ratio. I like to buy companies that I’m not planning to sell and that will pay me a share of their income for the rest of my life. It feels good to buy Starbucks with money that Starbucks have sent me from their last quarter income. I don’t need to worry about price changing, and I feel that my money is working for me instead of just speculating that I bought something at a good price and I’m willing to sell it for a higher price to someone else. I’m not a trader. I’m an investor.

While it is impossible to advise someone about what to do with their money, I will always suggest searching what percentage between speculation and investing is comfortable for you. Don’t just look at big fancy returns, but look with a long-term perspective at what role investing plays in your life.