The Fed is going to keep interest rates near zero for the foreseeable future. With 10-Year Treasury yields around 3.5%, solid blue chip companies offering decent dividends become popular. Not only do they offer current income and the possibility of capital gains, they also have better protection against inflation than regular bonds. No wonder Warren Buffett wrote, “Buy American. I Am.” in The New York Times last October.
However, the economy is still in the bottoming process. There is a potential risk for the economic to backslide. Which blue chips are relatively safe?
I use following 9 criteria to select relatively safe dividend stocks:
1.Yield>=3.5%
As an alternative to 10-Year Treasury, stocks need to have at least that kind of yield.
2. Market Cap >$2 billion
Generally speaking, the bigger, the safer.
3. P/E and Forward P/E both <=20
September, 2009
Safe Dividend Stocks!
Submitted by Hao Jin on Wed, 09/30/2009 - 12:33Emerging Market ETFs. Are They Right For You?
Submitted by Mike Conlon on Tue, 09/22/2009 - 12:36****The following article is from our new guest contributer, Hao Jin, CFA of Point Financial Advisor. He will be contributing to the myWealth blog on an on-going basis. Look for his profile later this week.
