The 10-year yield has plunged by about 40 basis points since July 31, when the Federal Reserve cut its benchmark interest rate. Amid its slide, equity strategists at Goldman Sachs formulated a strategy to help investors find higher yields elsewhere.
The allure of dividend payers goes beyond higher yields: These stocks are relatively cheap and have underperformed the broader market since the end of the 2008 financial crisis, according to David Kostin, Goldman's chief US equity strategist. "Trade tensions have intensified, economic growth has weakened, and earnings estimates have been revised lower during 2019, but we view swap market pricing as overly pessimistic," he said in a recent note.'The greatest bubble ever': One market expert warns that a relentless bull market is on the brink of crashing and explains how to profit from its demise
What's more, the steep drop in Treasury yields means that their prices have become prohibitively expensive for some investors.
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