Dividends4Life: Dividend Stocks Are Appealing Again, But Beware

This is what was supposed to have happened: A recovery in global markets, led by the United States, would finally push up interest rates. Bond yields and rates on money-market funds and bank deposits would rise, making them more appealing to income-oriented investors. In turn, dividend-paying stocks would lose appeal, because the downside risk of equities couldn’t justify their single-digit yields. Maybe it’ll still happen in 2015, as was widely thought. But it sure didn’t start this week.

Instead, all the relevant markets reversed course. Equities sold off and interest rates fell as bond prices rose. And, as a result, there was a sharp increase in the number of stocks, in Canada and particularly in the U.S., with dividend yields that beat 10-year government bonds. Many investors will look back on this week and see a bloodbath. Some, who feel this is a blip, rather than a first step to a market collapse, will see it as a chance to buy.

Source: Globe and Mail

Related Articles:
- Are Defense Stocks Good Defensive Stocks?
- International Securities For A Diversified Income Portfolio
- 5 Dividend Stocks That Gave Me A 20%+ Annualized Return
- 6 Rainy Day Dividend Stocks
- When A Stock Fails To Raise Its Dividend: Is It Time To Sell Intel?

Click here to have future posts delivered to you for free!



Post a Comment

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


Popular Posts Last 30 Days