Tap On Dividend Aristocrats ETFs For Impressive Returns In 2021

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The Wall Street rally has been showing some signs of cooling down lately. Some major analysts are expecting a market correction. In this regard, Jared Woodard, investment & ETF strategist at Bank of America, has said that “we expect a buyable 5-10% Q1 correction as the big ‘unknowns’ coincide with exuberant positioning, record equity supply, and ‘as good as it gets’ earnings revisions,” per a CNBC article.

Notably, dividend aristocrats are the blue-chip dividend-paying companies with a long history of increasing dividend payments year-over-year. Moreover, the dividend aristocrat funds provide investors with dividend growth opportunities in comparison to the other products in the space, but they may not necessarily have the highest yields.

‘Dividend aristocrats’ or ‘dividend growers’ are mostly deemed to be the smartest way to deal with market turmoil. Notably, the inclination toward dividend investing has been rising owing to easing monetary policy on the global front and market uncertainty triggered by the pandemic and deceleration in global growth. The demand for these funds is mostly driven by their characteristic of being the major source of consistent income for investors when returns from the equity markets are uncertain.

Going on, these products also result in a strong portfolio with a higher scope of capital appreciation versus simple dividend-paying stocks or those with high yields. As a result, these products deliver a nice combination of annual dividend growth and capital appreciation opportunity, and they are mostly good for risk adverse long-term investors.

Studying the recent market optimism, it seems like positive developments with regard to additional stimulus talks have supported the market rally. President Joe Biden held a meeting with Treasury Secretary Janet Yellen and the chief executives of some of the country’s major businesses in the Oval Office to talk about his $1.9-trillion coronavirus relief bill and the outlook for the U.S. economy, per a CNBC article. In order to support the United States’ return to full-employment by 2022, Yellen recently requested Congress to pass Biden’s stimulus plan.

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