The nice thing about a bear market is that it gives you the opportunity to buy big-name companies at fairly reasonable valuations. Your only downside would be current management, which presided over the plan that resulted in the stock price going into the tank. I want to donate stock to charity, but my purchase price is higher than the stock s current price. You can only deduct the stock's current value. From a tax perspective, it s better to sell the stock, take the loss, write that off on your income taxes, and then donate the money.
Companies pay stock dividends as a way to reward loyal shareholders.
But mutual fund dividends are rather different. First, they aren t dividends, really. When a fund gets a dividend from a stock, it takes the cash and reinvests it in other securities. So the dividends are reflected in the fund s share price the day the fund gets the dividend. By law, the fund has to pay out all dividends to shareholders at least once a year.