That all-dividend diet you’re on may not be as healthy as you think. Stocks paying dividends have been superstars for three years now, but nothing works well at all times in investing. That’s why a dividend-based portfolio should include some growth stocks, which for the most part tend to be non-dividend payers.

Let’s not overplay the dangers of dividends. One thing you do not need to worry about is a dividend bubble – that’s a bogus term used by attention grabbers who like scaring retail investors. But while dividend stocks won’t crash, they will fall out of favour at some point. It might happen when the economy is flying and interest rates are rising steadily. Slow-and-steady dividend payers in sectors like utilities and pipeline could easily be roadkill for a time.

Source: Globe and Mail

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