Dividends4Life: Time to Move to Dividend Stocks

Time to Move to Dividend Stocks

Posted by D4L | Monday, December 13, 2010 | | 0 comments »

"The bond apocalypse is upon us," Cramer told viewers. He said with bond prices beginning to free fall, the loss of principal will become more than the interest gained. "Bonds can hurt you," said Cramer, as he advocated better alternatives. High-yielding dividend stocks is the place investors need to be, said Cramer. Almost 40% of the total return in the S&P 500 has been in the form of dividends, leaving a lot of money on the table for investors who are not participating. That's why Cramer said investors need to move their money, even retirement savings, out of bonds and into dividend stocks.

To illustrate his point, Cramer returned to his dividend portfolio from March 7, a group of five stocks up an average of 15.9% since their debut. Add dividends however, and that gain grows to 19.7% during a time when the S&P 500 was up just 11.9% and U.S. treasuries paid a paltry 4.2%. Cramer said a 4% yield is the minimum benchmark investors should be looking for.

Source: Investopedia

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