The Number 1 High-Yield Investing Tip That Could Earn You Thousands

If you want to gain an edge on other dividend investors, there's one very simple tip you need to know. It's just basic common sense, but way too many investors overlook it because they get caught up focusing on a company's story instead of the facts on the ground -- and in the end, you make the mistake of buying a high-yield dividend stock that ends up cutting its dividend.

I'm not going to keep you in suspense; what you need to do is check the balance sheet. Here's why it's so important, and a couple of ways to spot when a company can't afford its dividend.

A company can be thought of as a living organism that will almost always be looking to ensure its own survival. You may be a partial owner of the business, but that won't matter when the chips are down. The company is going to do what it needs to do to remain a going concern. Don't dismiss this -- it's very important for dividend investors to remember when looking at high-yield stocks. 

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Source Fool.com