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Fund Spy

Dividend Investing Abroad

As investors pile into U.S. dividend-oriented stock funds, it may be time to look farther afield.

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Whether to increase income as interest rates scrape bottom, or to reduce equity risk in a volatile market, investors in the United States have been in hot pursuit of dividend-paying stocks. Funds such as  Vanguard Dividend Growth (VDIGX),  Federated Strategic Value Dividend (SVAAX), and Franklin Rising Dividends (FRDPX) have seen their asset bases burgeon over the past year through May, even as U.S. equity funds overall have lost $125 billion.

Granted, noteworthy domestic dividend-oriented funds are still finding opportunities, and April 3's Fund Spy highlights several such funds. There are more plentiful opportunities abroad, however.

Laura Lallos has a position in the following securities mentioned above: VDIGX, XOM. Find out about Morningstar’s editorial policies.