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Dividend investing is one of the safer investment strategies, but there are still risks, as Mark Lowe pointed out in "Dividend Investing Simplified: The Step-by-Step Guide to Make Money and Create Passive Income in the Stock Market with Dividend Stocks."
This 2019 book also argued, "While it is impossible to completely get rid of the risk, it is still possible to minimize our risk exposure. You can do this by understanding the factors that play behind the sentiment in the stock market."
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record date:
The SEC also provided this table showing the sequence of events:
This is how the SEC described the events in the table:
Conclusion
Just because you are buying dividend stocks, you don't get a pass on risk management. Like any other stock or security, dividend stocks have risks; some of those risks can be controlled, and some cannot.
For those that can be controlled, risk management involves knowing the company's fundamentals, diversifying so that not all your eggs are in one basket and making decisions with your mind rather than your emotions.
Read more here:
Dividend Investing: Earning Passive Income
Strategic Value Investing: Value Investing in Mutual Funds
Strategic Value Investing: Finding Value Stocks
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This article first appeared on GuruFocus.
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