More Investors Turn Toward Dividend Stocks

When interest rates get too low, eyes turn to equity income. Dividend-paying stocks aren't just your Grandma's stock pick anymore. In these risk-averse-yet-yield-hungry times, more investors are turning to these stalwart market workhorses as a way to participate in the stock market's gains and earn a little income. Dividend-paying stocks, or the so-called "equity income" funds mutual funds that own them, are companies that give investors a piece of their profits in the form of a dividend payout, typically quarterly. These companies tend to be larger, more stable companies that have been around a long time. Think 3M, General Mills and Medtronic.

Most investors own several dividend players, but probably don't think of them in such terms. Three-quarters of the stocks in the Standard & Poor's 500 now pay dividends, according to research from Brian Belski, Oppenheimer Asset Management's chief investment strategist.

Source: StarTribune

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