On the advantages and disadvantages of dividend-paying stocks

Dividends can be divided into two ways: cash dividends and bonus shares. Dividends are the direct distribution of part or even all of the company's profitable funds to shareholders. Dividend distribution means that the company wants to continue to invest more money to expand reproduction, so it keeps the profitable money in the company, but issues new shares to the original old shareholders, but this kind of stock does not need to be bought by the old shareholders, and it is directly converted with the dividends that should be distributed.

No matter what kind of dividends, dividends of listed companies are due obligations, because joint-stock companies are constantly pursuing the maximization of interests for shareholders. Of course, the specific dividends can be flexibly arranged by the company according to the development needs. For example, the company is in a period of growth and development, and needs a lot of continuous investment. Of course, it can pay less dividends, pay more dividends or not pay dividends temporarily. Companies with relatively saturated market and little capital demand can of course pay more cash dividends to shareholders.

Usually, in the secondary market, stocks with a high proportion of red shares are sought after, and their share prices also perform well. After all, investing in stocks is to gain income through appreciation, just like putting money in the bank for interest. And I don't think any investor will welcome a company that will always be an "iron rooster"!