When he called the company he was told that they had

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Unformatted text preview: ne of his companies. When he called the company, he was told that they had run into financial trouble and were suspending dividend payments. Sam, to his surprise, found out that even companies that have paid dividends for decades are not legally obligated to keep paying them. Sam also found that four of the companies in his portfolio called themselves real estate investment trusts, though he was not quite sure what they did He found out soon enough when the entire real investment trust sector dropped 30% in the course of a week, pulling down the value of his portfolio. Much as he tried to tell himself that it was only a paper loss and that he could continue to receive dividends, he felt uncomfortable with the knowledge that he had less savings now than when he started with his portfolio. Finally, Sam also noticed that the remaining six stocks in his portfolio reported little or no earnings growth from period to period. By the end of the third year, his portfolio had dropped in value and the dividend yiel...
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