BOSTON ( TheStreet) -- The rollercoaster stock market has investors running for shelter in the form of top-rated companies that pay high dividends or mutual funds that invest in them.All U.S. equity mutual fund categories have seen large outflows this year, except for so-called equity-income funds, which took in $11 billion through Aug. 10, Standard & Poor's said. Investors are piling into the safest stocks as the U.S. economy is slowing. Just today, Morgan Stanley lowered its forecast for global economic growth.
The Vanguard Dividend Growth Fund initiated a huge position in defense contractor Northrop Grumman ( NOC), buying 2.2 million shares, making it its eighth-largest holding. The company builds everything from lunar space modules to parts for aircraft carriers. Although the defense budget is likely to shrink due to Congressional efforts to cut the budget deficit, Northrop's strength in the information systems, electronic systems and aerospace industries should keep it healthy. It carries a 3.76% dividend yield and its shares are down 7.8% this year.
The Vanguard Equity Income Fund added 567,000 shares to its existing stake in Unilever ( UN), making it a 1% stake. Unilever's shares are up 8.4% this year and they carry a yield of 3.84%. With a market value of $102 billion, Unilever is an international maker of packaged foods and household and personal products.
Vanguard Equity Income also initiated a stake in Consolidated Edison ( ED), buying 273,700 shares in the holding company of two regulated utilities that provide power to New York City and surrounding counties. The largest is Con Ed of New York. They provide steam, natural gas, and electricity to customers in southeastern New York -- including New York City -- and parts of New Jersey and Pennsylvania. It has a market value of $16 billion and carries a 4.4% dividend yield. Its shares are up 13.6% this year.