Received dividends increase your return on investment
Many investors look to dividend-paying stocks to generate income besides capital gains. But dividends are not extra returns; they are a part of total returns.
Also, you should remember that the company or fund is paying out a piece of the profit as dividends instead of reinvesting them.
So in the long term, you lose out on the compounding returns the reinvested profit could generate. Check out which mutual fund option is better for you – Growth vs Dividend
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