Dividend stocks can offer another tool for investment success
No matter where we are in the economic cycle, it’s always
good to remind ourselves of what worked and what didn’t. In 2017, Wall Street
forecast a rough year but quite the opposite happened. Benchmark indices hit
all-time records, while investors ended up being upbeat about most sectors.
In 2018, the long-running bull market took a breather as
investors switched from risk-on to risk-off.
2019 has only been a little forgiving, which is why I
recommend that investors get selective. And that sentiment is now multiplied
eight-fold as we digest the damage caused by the novel coronavirus.
Fortunately, with dividend stocks, investors have more leeway due to their
generally stable nature.
Although picking high-flying growth companies is a sexier
endeavor, they aren’t always the smartest stocks to buy. With passive-income
yielding firms, you get the potential to make capital gains and obtain residual
payouts to bolster your position. During a down period, dividends can also help
you ride out the storm.
But don’t mistake benefiting from these yields as “boring”
strategies. As with any asset class, you can dial up the risk for the chance of
greater rewards. No one knows your investment style better than you!
The following ideas are broken down into three sections:
stable, mid-level and high-yield (speculative). Each section has something to
offer, depending on how much risk you’re willing to take.
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