I’m always on the lookout for the best dividend stocks to buy now for my portfolio. Research shows that dividend income is an integral part of wealth creation in the long run. That’s why I prioritise income stocks in my portfolio.
With that in mind, here are five dividend stocks I’d buy for my portfolio right now.
Stocks to buy now
I think there are some fantastic bargains in the financial sector at present, so this is where I’m concentrating my efforts on finding the best stocks to buy.
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Unfortunately, this sector may not be suitable for all investors. Some financial companies can be challenging to understand, especially banks and insurance groups.
It can be tricky to understand how these institutions make money and the quality of their balance sheets. That doesn’t apply to every business, but some corporations in the financial sector are more complex to understand than others.
The first two companies on my list are Investec and Premier Miton. The former is a global investment powerhouse, while the latter is a relatively small asset management organisation. Both groups have their advantages.
Investec is a highly regarded global bank and wealth manager with a strong presence in Africa. Meanwhile, Premier Miton has won multiple accolades for the quality of its funds. That’s why I would buy these two high-quality dividend stocks for my income portfolio today. They offer dividend yields of around 5.4%.
Dividend stocks for income
I’d also buy financial services group Plus500 and CMC Markets. Both of these equities offer dividend yields of around 5.3%. They also provide trading services for products such as CFD and spread betting. This business can be highly lucrative in periods of high market volatility.
However, when volatility declines, trading can slow, often leading to a decline in income. CMC reported such a decline a few weeks ago, and the stock suffered a loss of more than 30% as a result.
Still, I’d buy both companies to protect against market volatility and for their market-beating dividend yields.
Finally, I’d also buy insurance group Aviva for my portfolio of dividend stocks. I believe this is one of the best shares to buy now because not only does the investment offer a dividend yield of around 5.8%, but it’s also selling at a relatively low price-to-earnings (P/E) multiple of just 8.8.
Aviva is currently trying to rejig operations by focusing more on its general insurance business and divesting non-core operations. In theory, this should help the company improve profit margins and gain market share in the UK. It’s also promised to return more cash to investors.
While there’s no guarantee this plan will yield the desired results, I’d buy the company for my portfolio dividend stocks, considering its potential.
