A 5-step approach to investing in dividend stocks
In this first episode, I break down everything I know about dividend investing into five basic steps. These steps then form a solid foundation upon which everything else in my investment strategy is built. So if you're looking for a high-level overview of dividend growth investing, this is it.
The five steps are:
- Step 0: Think like a business owner (more of a foundation than a step)
- Step 1: Identify quality dividend growth stocks
- Step 2: Estimate fair value based on future dividends
- Step 3: Buy stocks when there is a significant margin of safety
- Step 4: Invest more into the best stocks
- Step 5: Diversify to reduce risk