A Dividend Offensive
Dividend-paying stocks have regained their strong comparative relative basis relative to the S&P 500 while yielding north of 3.3%, which is well in excess of the 1.6% yield investors are getting from 10-year Treasuries. At the same time, the Dow Jones dividend index is showing less volatility than the S&P 500, with a beta of .78 (approximately 20% less volatile than the S&P 500). In short, dividend-paying names are giving higher yields than Treasuries while providing better price performance and less volatility than the S&P 500.
We are still in a risk-off environment in which traders are avoiding equities, but the money being put to use in equities is flowing toward dividend-producing names. The high relative yield versus government bonds should keep a strong bid under the group in the months ahead....296 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
There’s no substitute for a trading floor to get great ideas, so Jim Cramer created a better one at Real Money and blogs there exclusively. We then added legendary hedge fund manager, Doug Kass, with his exclusive Daily Diary and best investing ideas. Staffed with more than 4 dozen investing pros, money managers, journalists and analysts, Real Money Pro gives you a flood of opinions, analysis and actionable trading advice found nowhere else, and allows you to interact directly with each expert.
Already a Subscriber? Please login.
