Improving economic fundamentals should support rising equity prices. But when the increasing need for income intersects with a potentially more volatile environment, a dividend-focused strategy is worth a closer look. With their historic contribution to total return and ability to provide a consistent income stream, dividend-paying stocks have the potential to play a key role in meeting long-term income needs.
What are the potential benefits?
- Dividend growth historically has kept up with most inflation environments.*
- Dividends may help to offset negative returns during down markets.
- High-quality, high-dividend-paying stocks have outperformed during previous rising-rate periods.*
*Sources: Ned Davis and Bureau of Labor Statistics.
What does Federated offer in this category?