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Five Alternatives to Dividend Stocks for Yield

Dividend stocks are a popular way to generate income in a portfolio, particularly during low interest rate environments, but they’re not the only option. With equity valuations moving to highs that haven’t been seen since 2000, many investors are looking to diversify their income investments away from just dividend stocks and fixed income securities.

Let’s take a look at why dividend stocks might fall out of favor and five alternatives that you may want to consider to diversify your portfolio income.

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Stock Valuations Aren’t Cheap

S&P 500 Index Shiller PE Ratio
S&P 500 Index Shiller P/E Ratio – Source:

1. Real Estate Investment Trusts

2. Closed-end Funds

3. Master Limited Partnerships

4. Preferred Stock

5. Income ETFs

The Bottom Line