QVML - Companies May Become More Focused On Dividends As Bond Yields Rise
- It is no surprise to most investors that the effects of inflation are having a negative impact on some investment asset classes with the consumer price index running at 8.26% versus just 2.28% at the end of 2019.
- The increase in the 10-year US treasury yield has made bonds more competitive from an income standpoint versus the dividend yield of stocks in the S&P 500 Index.
- If investors believe inflation and higher interest rates are an issue that will impact the market for an extended period of time, dividend-paying stocks might provide some relief to the broader market volatility.
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Companies May Become More Focused On Dividends As Bond Yields Rise