Down stock markets change attitudes and style of investors. Extremely difficult to be won in this situation of uncertainty, as investors will likely focus their attention to companies with prospects for a dividend, this shift in priority to growth.
Witnessed a recent increase in investor confidence in future economic development, which explains the known orientation to more risk.
Even if we argue about whether the worst of the crisis has passed or not, the consequences will continue to be felt.
Over the past decade witnessed two violent „Mechi cycle. The first was connected with the end of the Internet balloon at the beginning of the millennium, and the second is that the last two years, leading to losses of hundreds of billions of dollars for investors.
In any event, the past is unlikely to be repeated or at least, investors will have two mind.
Rules of foolishly assume risk will be totally changed by this respect and regulatory bodies will observe the financial crisis of such magnitude should not be repeated.
What can be expected from now on? Much more attention from investors. Dose greed in their behavior is likely to cede to the country and sought their future profitability will be significantly lower.
Recovery of world economy (which eventually happens) will be felt most strongly by large and established companies that survive. There is expected to be focused and majority of investors’ interest.
In search of a more normal yield at the expense of risk, what better solution dividends distributed by companies, especially those able to retain the severe crisis at the moment.
Over time and in the normalization of the situation in the world, these companies, even if it reduced its dividend, will begin to increase.
Thus, funds paid to investors will begin to gradually move towards its historical average value for a longer period, including times of both growth and the severe conditions.
We all know that the dividend yield and the rate of dividend increases, especially for a longer period of time are the factors that make the prices of such mature companies. And increasing dividend yield is equal to the increase in the price of the shares of a company and obtaining a capital gain.
Those companies that succeed in distributing dividends are characterized with good capital flows, which further attracts more interest from investors, even in moments of crisis.