"Switching from Dividend Stocks to Treasuries: Is it Time to Make the Move?"
With the 10-year treasury yield now trading above 4%, surpassing the dividend benchmark of approximately 3.6% expected from investing in Schwab U.S. Dividend Equity ETF (SCHD), investors are being advised to consider moving their assets from dividend stocks to treasuries. The argument is that treasuries offer a higher yield and lower risk compared to dividend stocks, especially in the current market environment where interest rates are trending around 5%. The article suggests that cyclical businesses, which form a significant part of SCHD's investment strategy, may not deserve an implied growth premium as the Federal Reserve aims to cool the economy. Therefore, the author advises selling dividend portfolios/ETFs and buying treasuries instead.