The S&P 500's CAPE Ratio Just Hit Its Highest Level Since the Dot-Com Bubble. Here's What That's Historically Meant for Dividend Stocks.
Dividend growth stocks have historically weathered market storms.
Overview
The Shiller CAPE Ratio -- a measure of how expensive stocks are compared to a decade of earnings -- recently hit its highest level since the dot-com era, the only other time it has been this high. The last time this happened, the S&P 500 Index (SNPINDEX:^GSPC) lost about half its value over the next two and a half years.
I'm not predicting that this means we'll endure another dot-com-style crash. What I want to do instead is point investors to the investments that have historically performed well during market downturns: Dividend stocks. I'll also showcase an investment that should help provide your portfolio some ballast if we experience a meaningful correction in the coming months.
Image source: Getty Images.
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Originally published at www.fool.com.
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