Smart Income: Redefining The Search For Yield

Smart Income: Redefining The Search For Yield by Vikas Gupta – Executive Vice President & Chief Investment Officer, ArthVeda Capital

There once was a time when dividend paying stocks were recommended to widows and orphans, pension funds, and trust funds as safer, steady income providing investment vehicles. However, as stock dividend yields began to decrease over time, income-oriented investors turned to bonds to achieve the desired income in their portfolios.

Today these investors are faced with a dilemma. The default option for an income yielding portfolio is a fixed income portfolio.  However, in the aftermath of the global financial crisis, bond yields have gotten bogged down in historically low territory, and are currently stuck around the 2% range. Given these historically low...