'Very robust strategy': Fund manager makes a case for dividend stocks and names 5 to buy

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'Dividend investing goes in and out of favor from one year to the next, but over ... a multi-year period, it's a very robust strategy,' Ben Kirby says.

Dividend stocks aren't evergreen, but investing in them over several years can pay off, according to one portfolio manager. Their underperformance this year presents an opportunity, said Ben Kirby, who is also co-head of investments at Thornburg Investment Management. "Dividend investing goes in and out of favor from one year to the next, but over the course of a multi-year period, it's a very robust strategy," he told CNBC this week.

The Taiwanese chipmaker is trading at 14 or 15 times earnings, and is "one of the best businesses in the world," Kirby said, adding that they grow their dividend over time. "They are essential in the global supply chain." He said although Taiwan will remain a hot spot of geopolitical tensions, he likes it as a long-term holding.

pays out a yield of around 2%. CME : Kirby expects the derivatives exchange will "benefit" from volatility in September, a traditionally weak month for stocks. "Whenever volatility goes higher, as it often does in September ... people want to hedge more," he said. "And the more that they hedge that drives volumes," he said of CME. Investors can trade futures and options at CME in order to manage risk.

 

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