West Loop Financial LLCAre Dividends A Value Strategy? – West Loop Financial LLC https://www.westloopfinancial.com Evolutionize Site Wed, 19 Aug 2020 20:50:49 +0000 en-US hourly 1 https://wordpress.org/?v=5.1.22 Are Dividends A Value Strategy? https://www.westloopfinancial.com/2014/06/23/are-dividends-a-value-strategy/ https://www.westloopfinancial.com/2014/06/23/are-dividends-a-value-strategy/#respond Mon, 23 Jun 2014 15:23:33 +0000 http://evolvemypractice.com/?p=1061 As I’ve previously discussed, the Federal Reserve’s zero-interest-rate policy has “pushed” many investors—especially those who use a cash-flow approach as opposed to a total-return approach—to look to stocks and equity funds that have a high dividend yield; that is, that have a low price-to-dividend ratio. Adding to their attraction is that a high-dividend strategy has...

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]]> As I’ve previously discussed, the Federal Reserve’s zero-interest-rate policy has “pushed” many investors—especially those who use a cash-flow approach as opposed to a total-return approach—to look to stocks and equity funds that have a high dividend yield; that is, that have a low price-to-dividend ratio.

Adding to their attraction is that a high-dividend strategy has outperformed the market over the long term. And this has been true around the globe.

However, it’s long been known that a high-dividend strategy is basically a value strategy, one that correlates highly with value strategies such as buying stocks with low prices-to-book value, earnings, sales or cash flow. The question then is, Is a high-dividend strategy the best, or even a good, value strategy?

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