When invest in stock market, why are people so hard up over dividends?

[Stocker]

I will only invest in these companies if I am exactly aware of its growth potential

how do you judge its growth potential? What do you see?

You see the news? Which news source? How do you analyze these news source?

You see their industry group? What indicators do you use?

You see their financial reports? How to see their financials to pin point them as a growth company?

A honest answer after 5 years of investing experience in SGX: I don't know.

IMO, there is no simple formula to growth investing. Many growth stocks would have P/E more than 10 and that metric already start to stir my nervous stomach. I am leaning towards industry competence where u have strong knowledge of a particular industry and you have access to private information like some fund managers or simple to understand business. For e.g. for former, if u work in a bank middle or back office and you know clearly about silver lake. For e.g., for latter, if u work in a private equity fund and invest into ARA in early days.

I got burnt recently with China Fishery thinking that I know of superior information by subscribing to fishing industry magazines etc. But only to realize that sticking to my core knowledge for any growth stock is much safer. Another example is Yongnam. Clear market leader, venturing overseas, almost clinched Myanmar airport which threw e market price off the hook. What happened in e end?

If u turn back e clock 5-10 years ago, will u dare to invest in Super Group, Q&M dental, Nam Cheong and Osim? I don't think I will dare to do so..

Therefore, I rather wait for margin of safety where I think market is mispricing and happy with dividends if any that come along. The dividends also act as a indicator that pricing should not collapses as long as dividend is sustainable by cash flow and debt cost. For e.g. I invested recently in CSE global before e sale announcement of UK biz and divested after I think it's overvalued. Another e.g. but not so adequate will be Wilmar.

Fully agree with you MrEngineer.