2 Market Crash Dividend Stocks

The best place to hide out during a market crash? In your dividend portfolio.

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One of the top rules to investing seems to have been completely ignored during the market crash: trading on emotion. The doom and gloom of the financial industry has sent analysts putting up “beware” signs all over the place. What first started as a few dips and rebounds has since fallen to a full-on market crash, and the fear has sent investors over the edge.

Yet recently, there was some good news when Prime Minister Justin Trudeau announced the federal government would be providing $2,000 for up to four months for those workers who have lost income due to COVID-19 as part of the Canada Emergency Response Benefit (CERB). The news sent the S&P/TSX Composite up by 21% as of writing.

This means now could be a great time to get in on long-term stocks, as it looks like Canadians may have already seen the market bottom. In that case, dividend stocks are a perfect option. These stocks provide cash every quarter no matter what the markets are doing, providing you the opportunity to bring in funds, even if there is another downturn.

Royal Bank

Royal Bank of Canada (TSX:RY)(NYSE:RY) has a few things going for it in terms of its status as a dividend stock. First off, during the last recession, Canadian banks fared as some of the best in the world, and were some of the first to blast out of the market downturn. Today, these same stocks are a great defensive tool against a poor economy. Second, Royal Bank has a long history as a dividend stock, growing its dividend yield by 40% in the last five years alone.

But the best news is the company’s future. Royal Bank’s investment in Latin America means investors could take advantage of the funds coming in from an emerging market.

On top of that, the bank has already expanded into the United States and the wealth and commercial management sectors, where its competitors are still playing catch up.

All of this means the company’s cash flow and dividends should be safe for the foreseeable future. That future could see a boost of about 25% in share price as of writing if the stock jumps back to fair share value for investors in the coming months.

WPT Industrial REIT

WPT Industrial REIT (TSX:WIR.U) may not have the dividend history of Royal Bank, but it certainly has a similarly bright future. But let’s first look at the company’s present. WPT has the benefit of long-term strength, with 99% occupancy rate and an average lease term of about five years. The company also produces strong earnings and has plenty of cash on hand, meaning it is likely to weather this current storm successfully.

In fact, WPT may even see a boost afterwards. The REIT focuses on light industrial properties — the perfect options for distribution companies in the e-commerce industry. The e-commerce industry could see a boost as more people turn to online options for receiving products during today’s COVID-19 crisis. As the company continues to buy up properties, it plans to bring on even more e-commerce companies into its portfolio. That means the current amazing dividend yield of 10.17% could grow even further.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Amy Legate-Wolfe owns shares of ROYAL BANK OF CANADA.

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