What Bubble? Dividend Stocks Continue to Pay Off

Despite market buzz that dividend-paying stocks are nearing bubble-like proportions, investor demand keeps driving Global X Funds to create new income-producing exchange traded funds (ETFs), the company’s chief executive said Monday at a New York Stock Exchange bell-ringing ceremony. Global X Funds CEO Bruno del Ama (left) reported that within weeks of the Global X SuperDividend ETF (SDIV) passing its one-year anniversary of trading on the NYSE Arca on June 9, the fund’s net assets doubled to $93 million.

“The dividend-paying companies do outperform over a number of environments,” del Ama said at a breakfast before the NYSE bell-ringing. And in a counterintuitive twist, he added, the companies that pay the highest dividends have the lowest volatility—which helps explain Global X’s launch of so many income-producing ETFs. Robert Curry, a Barrington, Ill.-based Morgan Stanley Smith Barney wealth advisor who attended the NYSE event, said that the dividend trade may now be somewhat crowded, but that income equities continue to be a sound investment.

Source: Advisor One

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