The Best Recession-proof Annualized Dividend Stock
Safe dividend-paying stocks are often considered a predictable income stream that appeals to the more worrisome investors. But the fact is that, amassing capital and generating continued income are fundamental objectives for every investor.
We all would love to know when the next recession is coming and how it will affect our portfolios. So, a safe asset that can hold its ground regardless of economic conditions and short-term stock price fluctuations will always be welcomed.
Dividend stocks have proven during the last recession to maintain or increase their dividends each year while also outperforming the S&P 500’s 55% peak-to-trough plunge for over 20%. This means, they produce some outstanding recession proof investments a risk averse income investor would’ve benefitted from its ownership during the last recession.
But what about the next one?
We’re all looking for the best recession-proof annualized dividend stock and companies that:
- Have dividend yields near 3% or higher.
- Solid business models
- Reliable balance sheets
- And committed managerial teams that maintain and grow their dividends
Are commonly considered worthy candidates to become part of a diversified portfolio that’s supposed to help you sleep well at night confident that your passive income will keep you safe during the next recession, and likely to increase your wealth in the future.
However, chasing yield can cost you money since a rising dividend yield may simply be masking a money-losing stock.
How can a higher yield hide a falling stock you ask? Well, buy several $100-a-share stocks that pays $10 a year in dividends.
This seems impressive, a 10% annual dividend yield ($10 dividend divided by $100 stock price) that is 450% larger than the S&P 500’s roughly 1.8% yield. But then, the stocks crash to $50 a share and the company holds the dividend the same.
By this formula, the yield of these dividend stocks doubles, but wait a second, despite the higher yield, you’re worse off because you lost $50 a share on each of the stocks.
So, in order to avoid these pitfalls is important to:
- Analyze and evaluate companies
- Look for the ones that have qualities that support the safety of its dividend
- And its numbers suggest its stock might decline less than the market during the next downturn.
Finding stocks with market-beating yields and shares that at least keep pace with the market long term, is the way to get a rich dividend that isn’t eroded by a faltering stock price.
Disruptive assets in emergent markets.
These types of avenues perform well against recessions.
The ones that are positioned on a market that’s on the rise grants you more growth potential, which ultimately leads you to exponentially higher dividends, portfolio diversification and risk aversion. A promising startup from this type of markets would be the ideal avenue to ensure a right recession-proof diversification strategy for your portfolio.
Right now, it looks like FinTech companies are on the rise for the sheer fact that the startup landscape is creating new developing tools for investing work outside of the current markets.
There is an opportunity from a startup company in the Fintech sector that truly circumvent all the hurdles that next recession can represents for investors.
A new form of stock-like liquid tradeable instrument that expands the investor’s reach beyond currently localized markets.
Now… if you’ve made it this far it’s because you’re looking for something different and effective to make your money grow.
This is an avenue that also have the following features:
- Calculated risk.
- A clear exit strategy.
- A trillion dollars market
- And significant yearly dividends
This is a serious chance to get on the ground-floor of an ambitious, solid, visionary and profitable startup company that will provide you with the best recession-proof annualized dividend stock, that also acts like a currency …
And you can find out more about it here!