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The Advantage of Dividends Back to search results
Company: Principal Global Investors
Published: 15 February 2013
Business Area: Dividends
Format: Portable Document Format (.pdf)
Investors are seeking higher returns and lower risk in today's current volatile market environment. As a result, dividend paying strategies are receiving a lot of attention. But it's not just the current environment where dividend paying strategies make sense.
As illustrated by the chart below, dividend paying stocks have outperformed non-dividend paying stocks over the long run with less volatility. Edge believes that dividend paying strategies should represent a significant portion of investors' equity allocation as dividend payers have outperformed non-dividend payers in nearly every market environment. Moreover, the relative performance strength of dividend-payers is magnified during periods of market uncertainty or low economic growth. This paper, produced by Edge Asset Management, will review:
1. Why dividend payers may outperform in the long run-dividend payers often have better fundamentals and are better stewards of capital
2. What types of dividend stocks outperform-companies that can grow their dividends have historically had the strongest results
3. Why dividend paying strategies are attractive now-dividend companies outperform in most market environments, including periods of economic weakness.
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