Just Set It and Forget It With These Dividend Stocks

"When you churn through your portfolio with frequent trades and a high turnover rate, you're likely to underperform a patient set-it-and-forget-it strategy. For most investors, it's better to simply buy and hold a handful of dividend leaders instead of constantly chasing new stock-market trends."

"AT&T stock has a five-year monthly beta of 0.61, which means that the stock has historically moved 61% times as fast (both up and down) as the S&P 500. Yet, even if AT&T stock is a comparatively slow mover, it still has growth potential. Over the past five years, the stock is up 32%."

"If your broker allows you to automatically reinvest the dividends into more AT&T shares, then you could leverage the magic of compounding for a maximum wealth-building effect. This stock pays a 3.98% annual dividend yield."

Frequent portfolio trading typically underperforms patient buy-and-hold strategies. Investors benefit from concentrating on high-quality businesses with strong share-price growth and respectable dividend yields rather than chasing market trends. A diversified portfolio of dividend-paying stocks creates a passive-income machine. AT&T exemplifies this approach with low volatility (0.61 beta), 32% five-year growth, and a 3.98% annual dividend yield. Automatic dividend reinvestment leverages compounding for enhanced wealth building. This strategy suits long-term investors seeking stability and consistent income without active management.

Read at 24/7 Wall St.