Concerns over the Fed’s tighter monetary policy to fight multi-decade high inflation, deepening supply chain issues, the ongoing Russia-Ukraine war, and the possibility of an economic slowdown have kept the equity markets volatile over the past few months. This is evident from the CBOE Volatility Index’s 39.3% gains year-to-date.
Amid the volatile environment, dividend growth stocks attract massive investor attention because of their solid histories of dividend growth and stable cash flows. Such companies are well-positioned to generate a regular source of income, even during high uncertainty, due to their solid fundamentals, healthy cash flows, and strong businesses due to relatively inelastic market demand. The investors’ interest in the dividend stocks is evident from iShares Core High Dividend ETF’s (HDV) 10% returns over the past year.
