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Dividend funds attract investors for a lot of reasons, and a big one is the regular income.

But dividend funds have different styles, risks, and goals.

So how do you find the one? That's right for you. Morning Star Research. But dividend funds have different styles, risk, and goals.

So how do you find the one?

That's right for you.

Morning Star researchers have investigated what makes a great dividend fun.

Dan Sotiroff is the lead author and Todd Truby is the co-author.

Both are senior manager research analysts for Morningstar Research Services.

Thanks, Dan, and Todd for being here today. You're welcome. Thanks. Your study separates dividend funds into three groups, dividend income, dividend income, and growth. Dan, what makes these styles different from each other?

Well, perhaps maybe just a quick step back. Like, the reason we did that is there's a lot of

dividend funds that just say dividend, right? So it's kind of a blunt descriptor. It doesn't really

tell you like what's actually going on in the portfolio and how would you use this. So we thought

carving them out into three groups like that gets a little bit more granular

as to what these funds are actually doing.

So the differences between them, like let's start with dividend growth.

Those are going to be like your highly profitable blue chip companies.

Think of like Apple Microsoft right now.

They're going to end up in more of that dividend growth.

They've been paying dividends for a long period of time and they have a history of increasing their dividends over time.

Divident income, that's synonymous with like your high dividend yield type stocks. So, you know,

you think of like a Coca-Cola or something like that. Those are more value-oriented strategies.

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