BALTIMORE (Stockpickr) -- As months like August remind us, in the land of falling stocks, cash is still king.
All told, the S&P 500 Index shed 6.8% last month, bringing the broad market's total performance for 2011 to -4.23%. That's a catastrophic turnaround considering the fact that we entered the summer months almost 10% in the green.
It was a different story for dividends, though.
The S&P 500 High Yield Dividend Aristocrats Index, which is made up of 60 consistent income-paying stocks, has actually delivered positive returns of 0.45% this year. That may not be a return to write home about, but it at least beats the yield on three-year Treasury Notes right now. Don't be surprised that dividends generate better returns; income stock outperformance is nothing new.
Related: 5 Speculative High-Income Stocks Historically, dividend-payers have made a whole lot more money for investors than their nonpaying peers. Over the last 36 years, dividend stocks outperformed the rest of the S&P 500 by 2.5% annually, and they outperformed nonpayers by nearly 8% every year, all while paying out cash to their shareholders, according to a study from NDR. The numbers are even more compelling when looking at companies that consistently increase their payouts.![]() |
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