Read? Using dividends to provide a stable income

Those positive results do not mean that the income is guaranteed, of course, as share prices can also drop.

Investors who put money into Keppel Corp in 2014 when the share price was more than S$11 in order to get a high dividend, for example, have seen the share price fall to just over S$6 and annual dividends drop from 48 cents per share to 20 cents.


CHOOSING SHARES


Individuals investing in shares for their dividends will need to select them carefully so that they balance the potential returns with the risks of investing.


Simply picking shares which have the highest dividend yields is not a particularly challenging process, as investment advisory firm The Motley Fool observes.


However, investors need to look beyond the yield and consider the company’s financial performance as well as its rate of dividend growth.

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