Rate cuts navigation: Thriving with Dividend Kings.

In the previous, we learned that against the backdrop of expected interest rate cuts, some specific U.S. stocks, U.S. bonds, and gold are worth focusing on. The high-dividend stocks featured today could be one of the targets for investors to keep an eye on.

Why dividend stocks can benefit from a Rate Cut?

Dividend stocks are usually favored in the context of interest rate cuts. There are two potential reasons for this:

1. Lower interest rates may enhance the appeal of dividend stocks, as some investors rely on dividends as a primary source of income from their stock investments.

2 . Dividend stocks tend to perform better during economic recessions, which are often accompanied by rate cuts.

Two crucial factors of dividend stocks: Reliability and Growth potential

Many investors have a general comprehension of stocks with high dividends, yet these stocks can be further categorized based on distinct attributes. Among the most recognized classifications are the Dividend Aristocrats and Dividend Kings, each come with their own specific criteria for inclusion.

Typically, a Dividend Aristocrat comforms the following standards:

1. First it must be a component of the S&P 500

2. 25 consecutive years of annual dividend increases

3. Market capitalization is over $3 billion

4. Average daily transaction volume of at least $5 million in the last 3 months

Becoming a Dividend King entails even more stringent criteria, including 50 straight years of dividend hikes on top of the standard requirements.

This is only the basics of dividend stocks. More detailed investment dividend stocks can be learned in depth in our premium courses - How to invest in dividend stocks amid rate cut expectations?

Sustained dividend growth over lengthy periods is a rarity, as it requires exceptionally stable businesses with offerings resilient to economic downturns.

Therefore, high dividends are usually high quality companies in different sectors. Many well-known households such as $Coca-Cola(KO.US)$, $McDonald's(MCD.US)$ and $Walmart(WMT.US)$, which are typical representatives of high dividends.

How to spot stocks with high dividends on moomoo?

Dividend-paying stocks usually focus on the dividend yield, a metric reflecting cash dividends paid to shareholders relative to the stock's price. This is a crucial criterion for both Dividend Aristocrats and Dividend Kings.

Moomoo offers Featured Lists tool where you can discover rankings sorted by dividend yield.

Under the stock "Company" tab, you can find comprehensive information about the company, such as historical dividends and earnings changes.

Images provided are not current and any securities are shown for illustrative purposes only and is not a recommendation.

Risks and benefits

High-dividend stocks usually provide investors with a steady cash flow and the ability to have a stable income.

However, it typically grows slower and may not capture swift upticks like growth stocks.

In summary, dividend stocks offer an attractive option for investors seeking reliable dividend income. So if you are looking for a long term and stable asset allocation in anticipation of a rate cut, high dividend stocks could be one of the options.

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