It’s no secret anymore that hedge funds, who pretty much rule the momentum of daily market swings, endured a very rough first quarter of performance on a collective basis as per several recently released reports.
The shift out of last year’s leaders — Internet, biotech and 3-D printing companies — has been nothing short of dramatic, with many of these former hot names down 30%, 40% and even 50%, in some cases, from their 52-week highs.
Clearly, these sectors were over-owned as professional fund managers chased performance all last year and now have been forced to rapidly liquidate to reduce exposure on the way down.
As a result, the bullish tone exhibited in the post-Yellen testimony on Capitol Hill just three weeks ago gave way to a massive rotation out of high-beta growth stocks into dividend-paying value stocks with price/earnings ratios that actually represent growth at a reasonable price. As expectations for high P/E equities to deliver outsized returns have dramatically fallen off, money has moved into market sectors that offer reliable returns and steady growth.
Here are five names that allow dividend investors to profit from this compelling income opportunity.