Consider Equity Income Funds for Today's Market
Investors who are looking for an investing strategy to potentially cushion equity market risks, while pursuing the long-term goal of growing wealth in today’s environment, may want to consider the benefits of an investment focus on dividend-paying stocks for seeking current income.
Different from “value” investing, Equity Income investing seeks both growth and current income from stocks of companies that have stable business models and the potential to maintain and/or increase dividend payments over time. And since dividend distributions are a tangible asset, the ability for companies to declare and distribute dividends can be a valuable indicator of the strength of a company’s balance sheet, its corporate fundamentals, and business model.
Furthermore, with the low current yields on U.S. government debt along with the prospects of prevailing low interest rates, investors with an appropriate risk tolerance may wish to consider high-quality equities as an income-generating alternative.
Source: Ned Davis Research, Inc. © 2014. Past performance is no guarantee of future results. Please see footnote below for more details.
Standard deviation is the statistical measure of the degree to which an individual value in a probability distribution tends to vary from the mean of the distribution. The lower the value, the better. There is no guarantee that dividend-paying companies will continue to pay or increase their dividends. Non-dividend-paying companies may offer higher capital appreciation potential.
Performance based on the Standard & Poor’s 500 (S&P 500) Composite Stock Price Index, a widely accepted, unmanaged index of U.S. stock market performance. Dividend-Paying and Non-Paying dividend stocks are defined by each stock’s dividend policy that is determined on a rolling 12-month basis. Ned Davis Research classifies a stock as a dividend-paying stock if it pays a cash dividend anytime during the previous 12 months. For instance, if a stock pays a dividend on July 1, it will be classified as a dividend-paying stock through June 30 of the following year. The index returns are calculated using monthly equal-weighted geometric averages of the total returns of all dividend-paying (or non-paying) stocks. A stock’s return is only included during the period it is a component of the S&P 500 Index. The dividend figure used to categorize the stock is the company’s indicated annual dividend, which may be different from the actual dividends paid in a particular month. Dividend Growers/Initiators is a subset of dividend-paying stocks and include stocks that increased their dividend anytime in the last 12 months. Once an increase occurs, it remains classified as a grower for 12 months or until another change in dividend policy. Investors cannot invest in any index. Actual investment returns may vary.
Diversification and asset allocation do not ensure a profit or protect against loss.
The performance and rankings quoted represent past performance, which is no guarantee of future results. Share price and investment return fluctuate and an Investor’s shares may be worth more or less than original cost upon redemption. Current performance may be lower or higher than the performance quoted. Go to Dreyfus.com for the fund’s most recent month-end returns. The Dreyfus Corporation has contractually agreed to waive receipt of its fees and/or assume the expenses of Dreyfus Equity Income Fund until October 1, 2014, so that the net operating expense the fund’s Class A shares (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed 0.85%. Total expense ratio Class A: 1.30% (Net Operating Expenses, Class A: 1.10%).
Investors should consider the investment objectives, risks, charges, and expenses of the fund carefully before investing. To obtain a prospectus, or a summary prospectus, if available, that contains this and other information about a Dreyfus fund, investors should contact their financial representative. Investors should read the prospectus carefully before investing.
Equity funds are subject generally to market, market sector, market liquidity, issuer and investment style risks, among other factors, to varying degrees. Investing internationally involves special risks, including changes in currency exchange rates, political and economic instability, less market liquidity, lack of comprehensive company information, and differing auditing and legal standards. These risks may be greater in emerging markets, which tend to be more volatile than the markets of more mature economies, and generally have less diverse and less mature economic structures and less stable political systems than those of developed countries.
There is no guarantee that dividend-paying companies will continue to pay, or increase, their dividend.