You can take it to the bank: interest rates are going up. Everyone from Janet Yellen to Donald Trump says it needs to happen. Traders betting through the Fed futures markets agree. More hikes seem likely next year, if oil prices keep rising, taking inflation along with them. Since higher rates are bad for high-yield assets, does this mean it’s time to give up and accept that 2% dividends are the only income you can expect in this market? No way. Because there’s an easy way we can protect ourselves from higher rates and still collect a nice 6.8% dividend yield. It involves buying three often-overlooked investments I’ll show you in a moment. Together, they form a broadly diversified portfolio that gives you reliable downside protection in case our overheating stock market decides to slide.
To build a portfolio that will withstand higher rates, I’m going to choose a floating-rate business development company (BDC), a hedged bond fund and a floating-rate bond fund. All four have one thing in common: they’re high-income assets that will not go down when rates rise, and can actually go up. Dividend Stocks That Will Thrive As Interest Rates Rise: Pennantpark Floating Rate Capital Ltd (PFLT), ProShares High Yield Interest Rate Hedged (HYHG) and Pioneer Floating Rate Trust (PHD).
Source: InvestorPlace
Related Articles:
- 3 High-Yield Dividend Achievers With 25 Years of Increases
- 17 Investments That Pay Monthly Dividends
- 5 Dividend Stocks To Build Your Future Security
- 7 Dividend Stocks With A Low Payout Ratio
- 5 Dividend Stocks Beating the S&P With Positive Returns In Excess of 50% YTD
3 Dividend Stocks That Will Thrive As Interest Rates Rise
Posted by D4L | Sunday, January 01, 2017 | ArticleLinks | 0 comments »________________________________________________________________
Subscribe to:
Post Comments (Atom)
~
Popular Posts Last 30 Days
-
As a relatively new blogger, the one thing that has stood out in my mind is the number of Canadian bloggers in the areas that I am most inte...
-
GameStop (NYSE:GME) lost about 40% of its market value over the past three years, as rising digital downloads and declining mall traffic thr...
-
In a capitalistic society, opportunities to generate (mostly) passive income are all around us. Dividend growth investing is one of the most...
-
These elite income producers have rallied this year. Their brilliance at producing passive income seems to have caught the market's eye ...
-
Since the market highs in July, stocks have been under considerable pressure. Indeed, 10-year Treasury yields are at the highest level since...
-
Buying dividend stocks can be tricky. Oftentimes, stocks that pay exorbitantly high dividends have underlying financial problems, and their ...
-
While optimism in the broader market remains robust – particularly for hyped-up sectors like technology – investors may still want to consid...
-
If you are looking for reliable dividends, these three Dividend Kings should be right up your alley. Dividends are paid at the discretion of...
-
A strong dividend investing strategy may be to focus on high-quality names that score well on several dividend-related metrics. In other wor...
-
Despite all that work, its valuation remains dirt cheap. That's a big reason why its distribution currently yields more than 9% despite ...
0 comments
Post a Comment
Post a Comment
Note: Only a member of this blog may post a comment.