Some have been warning that with the Federal Reserve likely to soon raise interest rates, income-producing stocks will no longer be appealing. Here are 5 reasons I still favor dividend-paying stocks:
1. Dividend income and its reinvestment has historically comprised a significant portion of long-term stock gains. 2. Dividend-paying stocks actually have delivered better long-term total return performance than non-dividend payers by a score of 10.4% per annum. 3. Dividend-paying stocks have enjoyed lower volatility. 4. Dividends today compare very favorably to income that can be generated from more traditionally conservative investments. 5. Dividend-paying stocks have performed well in the past in periods of rising interest rates.
Source: Forbes
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