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Wait… what? We flip the script. There are wrong reasons to invest in dividend stocks, and if you follow them, you’ll likely end up disappointed. Mike and Vero break down the traps of building a dividend portfolio without purpose.

You’ll walk away with clarity, not just on dividend investing—but on how to use it for the right reasons.

Chasing Yield Is a Dangerous Game
A high yield might look tempting—but it often signals a struggling business or falling stock price.

• Mike explains why he’s “yield agnostic” and cares more about the dividend growth trend and payout ratio than the percentage itself.
• Companies offering yields of 8–10% may simply be returning your own money, rather than creating value.

The Power of Total Return Over Pure Income
You don’t need to avoid selling shares.

• Mike shares how trimming positions like Apple allowed him to generate income without losing capital.
• A steady yield without growth is like getting a raise that never comes—you’ll eventually lose buying power.

Dividend Stocks Won’t Always Beat the Market
Especially in short timeframes.

• Dividend ETFs often underperform the S&P 500 due to missing the Magnificent Seven.
• But long-term dividend growers are often quality companies with staying power—and Mike prefers knowing exactly what he owns.

Dividends Are Not Guaranteed
Just because a company has paid dividends doesn’t mean it will.

• Investors must stop trusting weak narratives and start analyzing financial metrics.
• A flat dividend or rising payout ratio is a red flag.

Volatility Happens—Even With Dividend Stocks
Dividends help smooth the ride, but equities are still equities.

• Tracking your annual dividend income can provide peace of mind during volatile market conditions.
• Mike finds strength in seeing his income grow, even when prices drop.

DIY ETFs: Don’t Build a Portfolio You Can’t Manage
A 100-stock portfolio sounds diversified—but it’s risky if you’re not monitoring those holdings.

• Most pro managers stop at 40 stocks.
• Without regular reviews, great companies can quietly deteriorate into mediocre ones.

Diversification Doesn’t Mean Betting on a Trend
Don’t overload on “hot” sectors like AI, copper, or cannabis.

• Real diversification means spreading across industries and investment theses.
• Mike likes thematic ideas (like infrastructure) but never overweights them.

Stop Mixing Strategies Without a Plan
Don’t Frankenstein your portfolio.

• Blending BTSX, ETFs, and stock picking can backfire without intention.
• Many investors unknowingly duplicate their ETF holdings with individual stocks.

The Right Reason to Invest in Dividend Growers

• You want to be in control.
• You’re willing to put in a bit of time to learn.
• You understand your strategy and stick with it.
• This is how dividend investing builds lasting wealth—not just yield.
   

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