Ask Matt: How important are dividends?

April 1, 2015 10:32 AM

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Ask Matt: How important are dividends?

A: It’s easy to think dividends are the pennies a share that get added to your brokerage account each quarter. But these seemingly small payments can add up and turn into a major driver of shareholder wealth.

Dissecting the market’s total return from last year highlights how important dividends are. The total return of the Standard & Poor’s 500 was 13.7% in2014, which includes both stock-price appreciation and dividends, says S&P Dow Jones Indices. Of the total return, dividends accounted for 16.8% of th...

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