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Find the best kinds of investments for yourself that would fit into your investment objective while also earning you profit despite the volatile state of the economy

There is no doubt that the Covid-19 pandemic has had significant impact on the socioeconomic landscape of the world and has wreaked havoc globally in many ways with its trails likely to continue to be felt for a while. It is also generally true that there is no better time to start investing than now.

Business and market experts have been talking about a potential stock market crash from the onset of the pandemic. As opposed to panicking, smart investors are poractively seeking opportunities, riding the wave of the market uncertainty and still coming out tops.

What is important is that you  find the best kinds of investments for yourself that would fit into your investment objective while also earning you profit despite the volatile state of the economy.

One of such investments that can ride above the tides in the face of the global upheavals such as this one, is our trusted dividend stock.

What are dividend stocks?

As the name implies, dividend stocks are stocks in companies that pay out regular dividends. Dividend stocks can be an important source of passive income as they provide regular payments from company's earnings though dividend payments which could come in the form of cash, shares or even properties.

Why you need them now

Investing in dividends stock comes with a myriad of benefits especially in the long term as many dividend-paying companies are usually strong companies with good prospects for long-term performance.

The first reason they should be added to your investment portfolio now is that these companies are typically very stable and highly-capitalized. As such, if there are companies that should survive a downturn, they are these ones. 

Another great advantage is that investors’ profit in dividend stocks comes in two ways: The first is through the appreciation in the price of the stock and the other is through distributions made by the company.

Many companies that pay dividends are strong performers, and they are able to make distributions to investors because they have a great deal of cash.

Investors who are nearing retirement or are already retired many gravitate toward dividend stocks as a source of income. These companies can also pay more than what investors could earn with government securities or other types of bonds.

It is, however, also important to note that there are still risks involved in investing in dividend-paying stocks in spite of these benefits as they are still subject to changing prices in the marketplace and market performances.

There is also the truth that these companies hold the power to suspend, slash, or eliminate dividend payments. Yet, this security is one of your best bet now.

Written by Lawretta Egba.