Deep Dive: Here’s a better, and safer, investment strategy for dividend-stock investors

Some income investors are taking on more risk in this low-interest-rate environment by chasing higher yields. A better approach might be to seek out so-called quality companies with lower, but rising, dividend payouts.

Historically low rates have lasted longer than most people predicted when the Federal Reserve began a series of drastic moves to defend the economy during the financial crisis in 2008. The world remains awash with cash, which means investments with attractive interest or dividend yields keep getting harder to find.

Mike Loewengart, E-Trade’s vice president for investment strategy, said he was alarmed by an increasing trend among investors, even “younger ones in the accumulation phase,” to opt for stocks with high dividend yields.

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