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The Dividend Investor: A practical guide to building a share portfolio designed to maximise income by Rodney Hobson

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Chapter 27. Ten Dividend Rules

1. Spread risk

It is the first rule of investment and it applies particularly to dividend investors. We are not here for a quick killing, nor are we thirsting for the excitement of the casino table.

Diversification to diminish risk is particularly important for income-seekers who cannot afford to lose capital or see the stream of income dry up.

2. Look for sustainable long-term growth

Dividend investors are not looking to chop and change or to cash in quick profits so it follows that you want companies and sectors with genuine continuous prospects for profits, cash flow and, hence, dividends.

Better still if you can get in before other investors spot the company’s potential, but in that case you need ...

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