Dividend Stocks May Keep Running

by Laura Ehrenberg-Chesler on March 29, 2013

in equity market,Foreign Markets,Investment Strategies

The 10-year Treasury bond yield has dropped below 2% again, and the hunt for yield continues.  As Marilou mentioned on Wednesday, with all of the turmoil in the Euro zone due to the destabilization of the banking system in Cyprus, the United States has once again become an investment safe haven driving stock prices higher.

The stock prices of those companies offering above average dividends tend to be more stable in general, even during volatile times in the markets.  However, in the past few years, many of these stocks have actually outperformed their more “growth oriented” peers.   Growth stocks generally don’t offer above average dividends.

In the coming weeks, it will be interesting to see if the correlation between the drop in Treasury yields, and the rise in the prices of income oriented stocks, continues.

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