Dividend stocks can offer another tool for investment success
Given the historic disruption that the novel coronavirus has
imposed and now the nationwide protests for social equality, it’s admittedly
difficult not to panic and dramatically change our investment strategies.
First, what has inflamed tensions the most is the destruction of the labor
market, with more than 40 million Americans losing their jobs since the
pandemic shuttered the economy.
Sadly, communities of color have disproportionately bore the
brunt of this economic fallout. Later, the horrific killing of George Floyd,
who was under police custody at the time, sparked nationwide protests. Nor was
this an isolated incident as several racially charged events led up to Floyd’s
death.
It goes without saying that investors need to be selective
with their funds. And that was a relevant sentiment prior to this crisis.
Fortunately, with dividend stocks, investors have more margin of error due to
their generally stable nature.
Although picking high-flying growth companies is a spicier
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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