Dividend-paying stocks are as close to a “no-brainer” investment as they come. #-ad_banner-#You only need to look back at the last four decades to see just how smart having your money in these income producing machines has been. According to a 42-year study by Ned Davis Research, from 1972 through December 2013, U.S.-based dividend stocks in the S&P 500 returned 9.3% a year on average — far exceeding the 2.3% annual return for S&P stocks that didn’t pay dividends. There’s just one problem with them right now. As dividend stocks have attracted more and more money over the… Read More
Dividend-paying stocks are as close to a “no-brainer” investment as they come. #-ad_banner-#You only need to look back at the last four decades to see just how smart having your money in these income producing machines has been. According to a 42-year study by Ned Davis Research, from 1972 through December 2013, U.S.-based dividend stocks in the S&P 500 returned 9.3% a year on average — far exceeding the 2.3% annual return for S&P stocks that didn’t pay dividends. There’s just one problem with them right now. As dividend stocks have attracted more and more money over the past few years, there’s concern that some have become overvalued. I showed readers quite a few of these widely-held, yet overvalued dividend payers in a recent article. And one of our income investing experts — Amy Calistri, Chief Investment Strategist for StreetAuthority’s newsletter, The Daily Paycheck — first wrote about this troubling trend (along with a few more overvalued dividend stocks she found) over a year ago: Valuations of defensive dividend-paying stocks have become downright lofty. The irony, of course, is that the overcrowding in these “safe”… Read More