Dividends are considered the ones that enable investors perform well in both good and bad markets. Indeed, during hard times, such as the 1929 crash and the crisis of the 40s, 50s, and 60s, investors turned to dividend stocks due to the return dividends provided. The interest for dividend stocks is a result of a change in the investing environment. Conventional passive growth stock has betrayed investors. Between 2000 and 2009 investors were significantly affected. NASDAQ growth stock index generated losses of 44.5%.

There are three important issues that are true about investing: 1. Most investors are concerned with the safety of their capital and have a low tolerance for volatility. This may cause panic and may make them turn to bailouts when they should not do so. 2. Investors should have an investment method by means of which they can manage the stock-related risks at the same time they receive profits. This will definitely do away with panic and bailout. 3. Dividend stocks provide cash flow and inflation protection. Investors should be able to combine them to remain in a steady position, create returns and achieve their goals.

Source: Guru Focus

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Investors sometimes talk about going defensive only to protect themselves from sharp downside movements. All too often they associate defensive stocks with hedging tools that provide little upside potential. What if you could pick a defensive investment risk management strategy that also provided market-beating gains over the past 10 years? Read on to find out how defensive can also be offensive in these bad markets.

You can easily employ this simple strategy. We look for a dividend yield (or cash distribution) of at least 5% and we focus on U.S. companies. We also look for long-term dividend and earnings growth; if either is negative over a five-year average, we exclude the company from our list. Our only selling rules are when the five-year average dividend or earnings growth turns negative. We target a maximum of six stocks.

Source: Benzinga

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-Bank of the West’s Wealth Management Group today released its 2012 investment outlook, recommending portfolio overweighting in U.S. large capitalization dividend paying equities and emerging and frontier markets. “We are cautiously optimistic on the U.S. economy for 2012 and believe market fears of a double-dip recession have faded. Our expectation is for relatively slow growth in the first half of the year for the United States, followed by improved momentum as the year progresses, with GDP growth in a range of 1.5 to 2 percent for the full calendar year,” said Don Silva, head of Investment Advisory & Management for Bank of the West’s Wealth Management Group.

The United States’ accommodative monetary policy, improving consumer trends and strong corporate balance sheets provide a foundation for improved results at U.S. large-capitalization companies, particularly those that pay dividends, according to Wade Balliet, director of equities for the bank’s Wealth Management Investment Advisory & Management team.

Source: EON

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Dividend stocks have been hanging out with the popular kids in the fixed income class lately, so much so that some investors worry that their egos – and prices – are a bit too inflated. Not necessarily so, says DWS Investments, the retail asset management arm of Deutsche Bank:

“While high-dividend-yielding stocks may not maintain their popularity, we do not expect a quick reversal of those factors leading to their attractiveness—namely, a quest for yield by investors across asset classes and the perceived defensiveness of high-dividend-yielding companies in an environment of macroeconomic concerns. Investors who get out of high-dividend-yielding stocks early could potentially leave money on the table.”

Source: Baron's

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Just because the economy is growing does not mean investors should abandon high-paying dividend stocks in favor of growth names, says Oliver Pursche, co-portfolio manager of GMG Defensive Beta Fund (MPDAX). "No one is saying you shouldn't own growth stocks. The point is that dividends are a key component of total return, so investing in high-quality, high dividend paying stocks that also have growth characteristics should do very well in 2012, just like it did in 2011," says Pursche.

Pursche specifically points to McDonald's(MCD_) as a company that fits his growth plus dividend criteria, as the fast-food purveyor continues to expand internationally without skimping on its dividend, now yielding 2.8%. The company's stock is up more than 35% in the past year, compared with domestically oriented Wendy's(WEN_), for example, which is up only 2% and yields 1.5%. And Pursche sees more room for Mickey D's to grow in 2012 even with a slowing Europe.

Source: The Street

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