Besides the short-term potential for passive income, dividend stocks appeal to investors for their potential to magnify price appreciation thanks to reinvesting opportunities. In fact, dividend payers can manage to outperform other stocks even if their price does not go up—in a volatile market, for example, steady distributions can be used to buy up more shares of a dividend name for an amplified return. This is a big part of the reason why dividends have contributed almost a third of the return of the S&P 500 since its early days as a 90-stock index in the 1920s.
No wonder, then, that investors often seek out strong dividend names to round out their portfolios. As it comes time to rebalance for the new year, the following three ultra-high-yield dividend names may stand out from the crowd.
