How this $36-billion money manager is finding dividend-paying winners amid higher interest rates

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Stu Kedwell of RBC Global Asset Management is focused on dividend investing for long-term performance

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“Some might say it’s kind of mundane … but it’s not going to be as volatile as some conventional equity investments,” says Mr. Kedwell, managing director, senior portfolio manager and co-head of North American equities at RBC Global Asset Management in Toronto, who oversees about $36-billion in assets.

The fund is 41 per cent financials, 18.5 per cent energy, 15 per cent industrials and the rest in sectors such as consumer staples and discretionary stocks, utilities and real estate. Its top five holdings as of Feb. 29 include Royal Bank of Canada Rather than trying to predict what will happen, we try to understand what could happen and where the stock sits in relation to those scenarios. For instance, if a stock is near its bear case, we potentially have a lot of upside. A quality company with a good management team will do what’s necessary to realize the base case eventually - and perhaps the bull case. We focus on dividend-paying stocks with a good current yield that we expect will have good dividend growth over time.

 

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