Comparing a low dividend yield portfolio to a well diversified portfolio may provide misleading results because
A) of the tendency to ignore dividends and interest.
B) low dividend yield stocks are not traded on the New York Stock Exchange.
C) low dividend yield stocks have lower risk.
D) low dividend yield stocks tend to have a smaller percentage price increase.

Question

Quizplus · Accepted Answer

Comparing portfolios solely on the basis of dividend yield can be misleading because it ignores other important factors such as capital gains, interest income, and overall performance. Low dividend yield stocks may still have strong investment potential based on their total return, growth potential, and other attributes beyond their dividend payments. Therefore, it is important to consider a range of factors when evaluating a portfolio's performance and potential.

Comparing a Low Dividend Yield Portfolio to a Well Diversified