Market Volatility Enhances Focus on Dividend Stocks

June 1, 2010 - PRLog -- June 1, 2010 -- Stocks that deliver a strong dividend yield are gaining favor among money managers, thanks to the increasingly volatile stock market.
For good reason, said Rick Ashburn, the principal at Creekside Partners.
“Dividend stocks offer a predictable income stream, which is all the more attractive in an up-and-down market,” said Ashburn. “Price appreciation is only a meaningful source of return when you can buy stocks cheaply -- cheap relative to their fair value. At present, we still feel that stocks are fully priced and that history tells us to expect rather mundane price appreciation from current levels. On average, stocks will appreciate by only 1.5 percent to 2.0 percent above inflation from prices like we see now.”
Fortunately for Creekside’s clients, Ashburn has favored dividend stocks in recent years over more conventional baskets, such as the S&P 500.
“If our outlook for the next decade is correct, dividends will provide a higher proportion of total return than price gains,” he said. To that end, Creekside has and continues to favor dividend-oriented mutual funds and ETFs, such as the Wisdom Tree family of ETFs and the S&P Global 100.  Creekside expects to add to stock positions if and when the S&P 500 Index falls below 1000.
About Creekside Partners
Creekside Partners, based in Lafayette, California, works with families to protect and grow their life savings. The firm values its independence in that it is not affiliated with any bank, brokerage firm or insurance company. Creekside does not sell any commissioned investment products, and is not bound by any proprietary investment offerings.
For more information, visit Creekside Partners at www.creeksidepartners.com.

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Creekside Partners, based in Lafayette, California, works with families to protect and grow their life savings. The firm values its independence in that it is not affiliated with any bank, brokerage firm or insurance company. Creekside does not sell any commissioned investment products, and is not bound by any proprietary investment offerings.