2 Dividend Stocks to Profit from the Fed Rate Hike

Given the uncertainty in the market and an expectation of flat returns, there’s one place investors should be as the Federal Reserve raises rates. Let’s take a look… Volatility has spiked in advance of the Federal Reserve’s expected lifting of interest rates. When such volatility materializes, it usually signals uncertainty. Most of the professional investor class has yet to witness a market of rising interest rates. Text books will tell them how to proceed, but is that something to trust?

About the best we can surmise is more of the same, especially in the equity markets. That means a sideways trade in a very narrow range, with minimal gains—if any—coming over the next year. In reality, there are some certainties regarding the central bank’s actions. At the top of the list is a flattening of the yield curve. Bond investors are in a real conundrum under such a scenario. Do they sell short-term bonds and buy long term as the curve flattens? Perhaps, but a better way to go might be to migrate to dividend stocks. Here are two good ones to help you weather the storm: Kellogg Company (K) and Snap-on (SNA).

Source: InvestorPlace

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