4 lessons for investors on the example of Warren Buffett's portfolio (5)

4. Do not ignore dividends
What is common to 80% of Berkshire's investments in public companies? As you can guess from the subtitle, each of them pays dividends. Yields ranged between 1.59% of the number of shares of 9 Delta Airlines and 3.56% of the number of shares of Coca Cola. However, this principle applies to the majority of Buffett's acquisitions: companies need to return incomes to shareholders, and dividends are one of the best ways to do this.
Buffett's investment style - an everlasting possession - also allows him to take the crop growing dividends. For example, Buffett began investing in CocaCola after the fall of the market in 1987, when the company's shares were at $2.2-2.5 per share. Today, CocaCola, whose shares on Friday at the end of the trading day costed $41.78, annually pay a nominal dividend of $1.38. The company's annual dividend is now giving 26% yield of the shares acquired in the late 1980s, which is an excellent result.
Paradoxically, despite Buffett's love to the dividend itself, BerkshireHathaway do not pay them. Buffett explains it simply: he prefers profits to continue to work in the business, contributing to the growth of the company, giving the ability to make acquisitions and increasing equity of Berkshire. Buffett believes that the long term growth of Berkshire will bring shareholders more revenue than the quarterly dividend.
Warren Buffett himself once said: "When I say that I've learned from experience, I say that the trick is to learn from the experience of others". No doubt, all of us can learn from uncle Buffett.