Dividend Underlying Growth Pushes Payouts To All-Time High

Dividends are the investor's best friend.

While companies such as Berkshire Hathaway, Amazon and Google eschew dividends in favor of reinvesting capital, there's no denying that for the rest of the market, dividend distributions are essential for returns.

Indeed, in 2015 Hartford Funds published a white paper on the power of dividends, which found that  Going back to 1960, 81% of the total return of the S&P 500 Index can be attributed to reinvested dividends and the power of compounding. According to the research, dividends are especially important during periods when the S&P 500 struggled. In the 1960s and 70s for example, dividends accounted for 44% and 73% respectively of the index's total return.

[klarman]