With investors over-saturating traditional safe-haven assets, like U.S. Treasuries, the overlooked utilities sector is beginning to garner greater addition as a income producer.
“As investors flee equities, commodity and sovereign risks, they are seeking the safety of relatively secure fixed income instruments, such as U.S. Treasury Notes,” Rudden added. “But the cost of this safety is high, with the ten-year Treasury Notes yielding 1.5%…an all-time historical low. However, utility dividend yields are much greater than that… 4.3%…and the risk to principal is low.”
Utilities Select Sector SPDR
For more information on the utilities sector, visit our utilities category.
Max Chen contributed to this article.