The 10-Year Treasury yield is holding at 2.85%, but another
run to 3% is coming soon. Let’s use this breather to sell our weakest dividends
and replace them with stocks that should actually head higher as rates rise.
You know the playbook by now. When the 10-Year yield
rallies, it crushes stocks with pathetic yields or meager dividend growth.
These “bond proxies” get dumped for the real thing as first-level investors
scamper to the 3% yields on “safe” US government debt.
If your portfolio relies on laggards like these—I’m talking
about penny-a-year hikers like AT&T and Walmart, or stocks that haven’t hiked
their payouts in years, like Wynn Resorts—I have two words for you:
Sell now!
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