Should Investors Replace Bonds With Dividend-Paying Stocks?
When bond yields are lower than dividend yields of stocks some investors may be tempted to replace their fixed-income bonds with high-yielding dividend-paying stocks. But this is not a prudent strategy for the reasons discussed below. The current yields on the 5-year, 10-year and 30-year U.S. Treasury bonds are 0.63%, 1.64% and 2.81%. respectively. Many stocks …
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