defensive investing in uncertain times continue to fill the Money Morning Mailbag as readers aim to gain more knowledge on protective investment choices like real estate investment trusts, options-straddle strategies and dividend stocks.
In Tuesday's Money Morning article "Defensive Investing: Seven Signs Your Dividend is in Trouble," Contributing Editor Martin Hutchinson detailed how high-yield dividend stocks provide a remedy for market volatility. They generate a yield or capital gains when the market is flat or gently rising, and offer protection against a market decline.
"Dividend-paying stocks provide better long-term returns in all but the most extreme bull markets," Hutchinson said. "Build yourself a diversified portfolio of solid dividend payers and you'll be exceptionally well protected."
Companies consistently paying dividends are less likely to have dramatic share-price declines. Meanwhile, investors who go after short-term gains can be left empty-handed when the stock market reverses.