Suddenly, boring is beautiful in the stock market.
As investors lick their wounds from early-year troubles and search for some stability in their portfolios, they are dumping shares in fast-expanding industries such as technology and turning to companies paying hefty dividends.
This year, stocks in the S&P High Yield Dividend Aristocrats Index—companies in the S&P Composite 1500 that have increased their dividends every year for at least 20 years—are up 1.91%, including dividends, compared with a negative total return of 4.3% for the S&P 500 index. The total return on the Dow Jones U.S. Dividend 100 Index, composed of stocks that offer consistent, high payouts, is negative 0.8%.
It is the latest sign of changing times in the markets, with income-generating investments suddenly warranting a premium, in contrast with the trend that held from 2009 to last year, when dividend stocks lagged behind a broad market rally.