Dividend investing as a safety net

Investors' stock portfolios were hit hard during the economic downturn, but if they had looked to a little-used income source, they may have avoided the pain of watching their investment income shrink. Dividend investing can give investors steady results, said Harry Cohen, managing director, senior portfolio manager and chief investment officer at ClearBridge Advisors.

"Companies that have the ability to pay a rising stream of dividends, that's what I really like. It gives people a raise every year," Cohen said, adding that yields are typically better than 10-year Treasury notes -- often in the 3.5 to 4 percent range. "You want companies that have strong cash flows." As companies receive pressure from their shareholders to increase their dividends, the opportunity for dividend investing improves, he said.

Source: ctpost.com

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