After a strong first half, where both the Nasdaq Composite ($NASX) and S&P 500 Index ($SPX) delivered double-digit returns, we have seen some volatility return to markets. Along with rich valuations, political uncertainty ahead of the looming November political elections seems to be making markets jittery.
Dividend stocks can be a good bet for risk-averse investors. Arguably, stocks with fat dividend yields have underperformed the markets over the last couple of years. The underperformance can be partially attributed to high interest rates, which lowers the appeal for dividend stocks. Also, high dividend stocks invariably happen to be value names in the old economy – an asset class that roaring tech giants have overshadowed.
