Why invest in dividend stocks?

It is well known that stock prices drop after the dividend date. So whatever you gain in dividend, which is also a taxable event, you lose in equity.


Answer:
   First off you invest in companies that have been paying dividends for a long time and ones that tend to raise dividends every year because the growing dividend income is much better than what they bank will give you on savings accounts or on cd rates so over time you are going to earn a good bit back on your original investment if you pick strong companies to invest in. Also there is nothing to say that your stock will drop after the dividend date, this may be true some of the time but again if you pick strong companies in the long run your stock will rise as will your dividend.