Dividends4Life: Calm Stocks for Any Market

Dividend Growth Stocks News

Calm Stocks for Any Market

Posted by D4L | Monday, February 27, 2012 | | 0 comments »

Down 90 yesterday. Up 40 today. Welcome to volatility, 2012-style. Indeed, as of Feb. 15 there wasn't a single trading day this year where the Dow Jones Industrial Average finished down 100 points or more. That's why many pros still want to own the stocks of stable businesses, ones that won't buckle when volatility returns. A strategy of finding so-called calm stocks paid off during the market's manic 2011. Investing in the S&P 500 stocks with the lowest volatility relative to the broad market in 2010 returned nearly 10% in 2011, while the most volatile fell, on average, 19%, according to Bespoke Investment Group.

The strategy is hardly sexy. Companies with less-volatile stocks are typically mature, slow-growing businesses, as opposed to those with dramatic increases in sales or profits each quarter. (In other words, you're not likely to find a Google or Coach among them.) But not all fit the bill. The key, say experts, is to find firms that are generating cash as well. "If you are essentially going to close your ears to the risk on-risk off nature of the market and hold on for the long run, these can work," says Jay Kaplan, comanager of the Royce Total Return fund.

Source: SmartMoney

Related Articles:
- 6 Tech Stocks With A History of Growing Their Dividends
- Buy And Hold Is Not Buy And Forget
- 6 Higher-Yielding Consumer Stocks With A History of Rising Dividends
- 9 Dividend Stocks With A Low P/B Ratio
- 7 Small-Cap Dividend Stocks For Yield And Growth

________________________________________________________________

0 comments

Post a Comment

Note: Only a member of this blog may post a comment.