One of the wealthiest investors you've ever heard of, Warren Buffett is a well known and big dividend investor. I admit, when I started investing I was all about Capital Gains but I've since shifted my perspective. 

We were discussing the Dividend Yields of some of the companies on the JSE and which ones were attractive to mention. It's a good opportunity to mention our stance on two companies - Supreme Ventures Limited (SVL) and Carreras (CAR). For personal, moral and faith-based reasons we will not ever review, recommend or discuss these two companies in our analysis for what they represent for us. It's a personal decision and we (me and my co-founder) leave each investor to determine their principles when investing. I thought I'd mention since we are discussing the topic of dividends. 

The current investing climate in Jamaica is one where Capital Gains are seldom found for those holding their investments for the medium to long term. In fact, you're likely seeing reducing gains over the past 12-18 months with companies seeing 52 weeks lows as investors look for alternatives or are simply looking for cash. This presents to me an opportunity to make a case for Dividends!

A dividend is a portion of a company's profits paid out to its shareholders. Dividends aren't guaranteed as it depends on the company's profitability, cash flows and/or priorities. Company's usually state their Dividend Policies in their prospectus. Blue Chip companies usually are known for paying consistent dividends, especially as they become mature companies, which makes them attractive to some investors.

We break down Dividend Investing here: The Complete Guide to Dividend Investing

As persons look towards long-term investing, dividends become more of a priority as the focus may shift to passive income instead of short-term capital gains. When choosing a dividend stock, it all comes down to the yield. The yield is calculated by dividing the total dividends paid over a year by the company's stock price. The more attractive the yield, the more cash you'll get back as an Investor.

I think its important to prioritize dividend investing now especially with the decrease in trading activities reported on the JSE. More information here: Tumbling Tickers and Stock Market Falls below Covid Low.

For me it's never either cap gains or dividends, it has always been both. Usually, cash flow from dividends are more reliable than capital gains realized from the market. We've seen companies with great performance struggle with seeing the stock price reflecting those gains. Of course, performance isn't the only factor to a stock price but one that's for another day.

Preference Shares are also known as a good option for investors looking for consistent income. A good way to spot Preference Shares on the market is to look for tickers with numbers in them such as PBS9.75, PBS10.50. We reviewed the PBS Preference Share offer in full here: PBS Preference Share Offer.

Dividends can provide you with stability of income while you add to your existing positions, some that will likely not recover until the market sees an overall recovery.

So, the question I'm asking here is are you taking advantage of dividend investing for your portfolio? If yes, leave a comment under this post, share it under the dividend investing video or let's discuss in the community groups.