A lot happened in financial markets in May. One of the more important things that happened was in the bond market. Fixed income yields plunged in May on concerns that the global economy is slowing and will continue to slow as trade tensions between the U.S. and China remain elevated. Specifically, the 10-Year Treasury Yield has dropped below 2.3% in late May, after peaking right around 3.3% in late 2018, and is now at its lowest level since late 2017.
One implication of plunging yields is that stocks with big dividend yields become more attractive. Why? Because the lower yields go, the higher dividend yields are relative to those fixed income yields. Thus, when yields plunge, investors tend to flock into dividend stocks with big yields.
Because of this dynamic, plunging yields create a good opportunity to buy into dividend stocks with big yields. Which stocks should be on your list of stocks to buy? Let’s take a look at six big dividend stocks to consider as yields plunge.