The Federal reserve bank wants to rise up the economy & combat inflation by raising interest rates 3 times next year according to its chairman Jerome Powell.
What does this mean for you as an investor? 🤔🧐
Speculative stocks will see LESS growth but dividend stocks will FLOURISH.📈
Why are dividend stocks so important when interest rates rise?
Because investors aren’t stupid, with high interest rates making it harder to buy expensive things they’d prefer buying stocks that are profitably NOW.
Not speculative companies that promise to make money later on.
Next year I believe tech centric portfolios will see a slowdown in valuation & a LOT more sideways trends while established income driven companies (like dividend kings) have an easier time in the market due to the predicted rise in interest rates by the federal reserve bank.
This is why I’m a big proponent of having dividend paying stocks in your portfolio because often times they weather most drastic economic activities (like a 3x spike in interest rates in 1 year).
Not saying to allocate 100% of your portfolio to dividends but you get my point…
Good dividend stocks are tried & true companies that have an established record of profits given out to investors
If you’re an investors in a high interest rate economy free cash-flow to reinvest is a gift from the gods
Some good dividend companies 🔥:
$PG $MRK $O $VICI $MDLZ $KO
I hope this helped some of you make more informed investing decisions.👍🏾
By the way If you want more knowledge on how to be a great long term investor download the Playbook for for more.