{"id":579179,"date":"2010-05-26T03:30:23","date_gmt":"2010-05-26T07:30:23","guid":{"rendered":"http:\/\/dividendsvalue.com\/?p=6520"},"modified":"2010-05-26T03:30:23","modified_gmt":"2010-05-26T07:30:23","slug":"11-low-beta-high-quality-dividend-stocks","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/579179","title":{"rendered":"11 Low Beta, High Quality Dividend Stocks"},"content":{"rendered":"

\"\"<\/a>In an economic downturn many investors turn to dividend stocks which are sometimes referred to as defensive stocks<\/a><\/strong>. These stocks offer sustainable dividends providing the investor with a minimum level of positive return, which helps buffer the downward pressure from the market. But what happens when the market turns up?<\/span><\/p>\n

Beta: A Measure of Volatility<\/h3>\n

Beta (\u03b2) is a quantitative measure of the volatility of a given security or portfolio relative to the overall market, usually the S&P 500. By definition, the market has a beta of 1.0 and securities are ranked according to how much they deviate from the market. Thus, securities with a beta above 1 are more volatile than the overall market, while those with a beta below 1 are less volatile. High-beta stocks are considered more risky, but provide a potential for higher returns. Low-beta stocks normally provide less risk and lower opportunities for capital gains.<\/p>\n

Betas And Dividend Stocks<\/h3>\n

Dividend stocks tend to have low betas. That means during a market downturn, they tend to decline less than the total market. Hence, the term defensive stocks. It is also important to note that many defensive stocks are non-cyclical. Examples would include food, tobacco, oil, and utilities where demand is remains stable under difficult economic conditions.<\/p>\n

Here are several dividend stocks with betas (as provided by Google Finance) less than 1.00:<\/p>\n

\n\n<\/col>\n<\/col>\n\n\n\n\n\n\n\n\n\n\n\n\n\n
Company<\/strong><\/span><\/td>\nAnalysis<\/strong><\/span><\/td>\nBeta<\/strong><\/span><\/td>\n% Yield<\/strong><\/span><\/td>\n<\/tr>\n
Cardinal (CAH)<\/td>\nLink<\/a><\/td>\n0.80<\/td>\n2.35<\/td>\n<\/tr>\n
AT&T (T)<\/td>\nLink<\/a><\/td>\n0.68<\/td>\n6.83<\/td>\n<\/tr>\n
Meridian (VIVO)<\/td>\nLink<\/a><\/td>\n0.63<\/td>\n3.63<\/td>\n<\/tr>\n
Coca-Cola (KO) <\/span><\/td>\nLink<\/a><\/td>\n0.60<\/td>\n3.41<\/td>\n<\/tr>\n
Becton, Dickinson (BDX)<\/td>\nLink<\/a><\/td>\n0.58<\/td>\n2.06<\/td>\n<\/tr>\n
Procter & Gamble (PG)<\/td>\nLink<\/a><\/td>\n0.58<\/td>\n3.12<\/td>\n<\/tr>\n
Johnson & Johnson (JNJ)<\/td>\nLink<\/a><\/td>\n0.57<\/td>\n3.54<\/td>\n<\/tr>\n
Kimberly-Clark (KMB)<\/td>\nLink<\/a><\/td>\n0.48<\/td>\n4.29<\/td>\n<\/tr>\n
Harleysville Group (HGIC)<\/td>\nLink<\/a><\/td>\n0.38<\/td>\n4.15<\/td>\n<\/tr>\n
Wal-Mart (WMT)<\/td>\nLink<\/a><\/td>\n0.24<\/td>\n2.36<\/td>\n<\/tr>\n
Abbott Laboratories (ABT)<\/td>\nLink<\/a><\/td>\n0.18<\/td>\n3.69<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/blockquote>\n

When the market turns up, low beta stocks normally won\u2019t increase as fast as the market in total. However, as a long-term dividend investor, my goal<\/strong><\/a> is an ever-increase stream of dividend income, not to maximize capital appreciation.<\/p>\n

Full Disclosure: Long ABT, HGIC, JNJ, KMB, KO, PG, T, WMT. See a list of all my income holdings here<\/strong><\/a>.<\/em><\/p>\n

(Photo: Steve Woods<\/a>)<\/h5>\n

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