Dizzy Over Dividends – Infographic by AllianceBernstein
US companies that offer high dividends are very popular among equity investors today. Shares of these companies are trading near record high valuations, as the very low interest-rate environment prompts investors to seek stocks that act like bonds. The market’s composition—illustrated in our infographic—demonstrates the risks of investing in the highest-yielding passive equity funds. In today’s market, we believe a selective, active approach, focused on valuation, growth prospects and company fundamentals, is essential in the hunt for dividends.
Seth Klarman: Investors Can No Longer Rely On Mean Reversion
"For most of the last century," Seth Klarman noted in his second-quarter letter to Baupost's investors, "a reasonable approach to assessing a company's future prospects was to expect mean reversion." He went on to explain that fluctuations in business performance were largely cyclical, and investors could profit from this buying low and selling high. Also Read More
The views expressed herein do not constitute research, investment advice or trade recommendations and do not necessarily represent the views of all AB portfolio-management teams.