Two Big Dividend Earners and One to Avoid

Some investors like to chase high dividend yields. These often prove unsustainable, and in some cases, incur large capital losses. But just because a dividend yield is a more reasonable 3 - 6%, this does not necessarily mean risk is eliminated.The income investor will want to look at payout ratios to see if there is margin to increase in bad markets or if prices pull away from earnings. If not and the PE ratios start climbing, yields may actually drop. Another aspect to consider is the consistency of increasing dividend payouts over time.... Read more