High-dividend-paying stocks tend to outperform all other equities during long time horizons, but they are the worst performers when interest rates increase. What we found is that over a full period of 1927-2013, that high-dividend stocks had the highest returns. But in the periods of rising interest rates they actually were the worst-performing category, and actually companies that didn't pay a dividend outperformed by a substantial margin. Although dividend stocks may be a great investment for the long term, if rates rise quickly they may perform poorly.
Source: Morningstar
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