Which of the following is the best deﬁnition of the clientele effect?

Question

Quizplus · Accepted Answer

The clientele effect refers to the phenomenon wherein stocks tend to attract certain groups of investors based on their dividend yield and the resulting tax effects. For example, high-yield dividend stocks tend to attract income-seeking investors, while low-yield dividend stocks tend to attract growth investors. This creates a "clientele" of investors that prefer a certain type of stock based on their individual investment goals and preferences.

Which of the Following Is the Best Deﬁnition of the Clientele