Some of the hardest hit stocks during this selloff have been those with strong yields as higher interest rates have made their dividends comparatively less attractive.
But is this selloff in dividend stocks overdone?
The Fed Giveth, the Fed Taketh Away
A common misperception is that over the last couple of years, yield-starved investors bid up all dividend stocks to untenable valuations and that this recent selloff is just a normal correction for these overbought securities.
That may be the case for some dividend stocks - but not all.
In fact, one of the hardest hit groups has been real estate investment trusts (REITs). But there are many REITs with strong fundamentals there were trading at very reasonable prices before the recent "dividend off" trade. (more)