Dividends4Life: Buying Stocks Like A Bond Investor

Buying Stocks Like A Bond Investor

Posted by D4L | Saturday, July 30, 2011 | | 0 comments »

Attracted to a stock with a fat dividend yield, but not so sure about the underlying company? Think about whether you would invest in the company’s debt. Plenty of people are talking about dividends these days, for a wide variety of reasons, ranging from worries about inflation to the slim yields on U.S. Treasury notes and beyond.

With big dividend payers, “you’re getting predictable cash flow that exceeds a 10-year Treasury out of the box.” Genter continues. The goal is to capture the bulk of moves higher – ceding the upper echelon to faster-moving stocks and high-fliers – but protect against a large portion of the downside by being assured (or at least promised) an income stream, it’s a win.

Source: Forbes

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