Are dividend stocks overvalued?

A dividend strategy that includes a low volatility screen may help ease investors’ valuation concerns

Boccellari_Thomas_sm_lowrezRecord-low interest rates have pushed some income-oriented investors into risky asset classes as a means of increasing both yield and total return. This has helped equity market valuations reach levels not seen since the recession of 2008. The chart below depicts the forward price-to-earnings (P/E) ratio for the S&P 500 Index over the trailing five years through Aug. 31, 2016.

Equity valuations climbing