E One Of Prince’s Quotes Can Be Applied To Investing: Dividends And Stock Growth

The rainbow appeared over Prince’s house hours after he passed away.

With Prince’s death fresh in our minds (God rest his soul), I found one of his quotes that can be translated to investing: “The most important thing is to be true to yourself, but I also like danger. That’s what’s missing from pop music today. There’s no excitement or mystery.”

Image source: acgoodyear@twitter

The first point ‘being true to yourself’ is acting according to what you believe in. As investors, we all have our own comfort level and tend to place our money towards assets that we have conviction in. When it comes time to click the buy button on a new investment, we feel comfortable that that particular stock fits our goals or investing philosophy. 

When Prince says that he likes danger, he is looking for excitement in something that goes beyond the ordinary or the predictable. As an investor, strong price appreciation is exciting. Many times, investors will take on more risk to reap the higher rewards. 

The combination of dividends and above average price appreciation provides investors with some comfort in the form of regular payments. So, if you are a dividend investor and believe in only buying stocks that have yield to be true to your investing beliefs, then the stocks that I will discuss are likely to be of interest to you. The excitement comes from the potential for above average price appreciation to go along with the dividends.

There is some danger since there are high earnings expectations for these companies. The stocks could fall sharply if the companies don’t meet the higher expectations. That danger is the extra risk that investors are willing to take on to reap the higher rewards. 

There is nothing wrong with investing in solid, relatively predictable dividend stocks. However, investors can also add some excitement to their portfolio by buying dividend-paying companies that have above average growth, which typically drives above average stock appreciation.

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Disclaimer:This article represents the author's opinions.  Investors should do their own due diligence and consult with an investment advisor to determine which stocks are right for ...

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David Zanoni 5 years ago Author's comment

I also wanted to point out that Prince did a great job of applying 'danger' or 'excitement' in both his style/image and his music. His style and music stood out from the rest.

AbbVie and Home Depot also stand out as strong dividend stocks with above average growth.