More of the same as last Friday...today I see a dealer has put out a report on the Attraction of Dividends. I can't believe that anyone, never mind an aging investor base, would look to the bottom of the capital structure - equities - where volatility is shockingly high, and use dividend paying equities to drive portfolio yield. Let's not forget a couple of things: 1) Dividends are simply a promise to pay - they can be cut by the issuer with no repercussions at all. Compare that to HY bonds that are backed by an indenture that is a legal document that states, among other protective covenants, that the issuer MUST pay us coupon interest every 6 months and 2) Equities are way more volatile than HY bonds. BAML research states that C$ HY over the past 5 yrs has annual returns of about 12% with volatiltiy of 9% while the TSX itself has annual returns of about 4% and volatility of about 17%. Even TD bank (or any other bank stock in Canada for that mater) has a dividend yield of <4% and volatility of about 15%. Crazy. Why not invest in C$ HY, move near the top of the capital structure of the issuer, be closer to the assets of the compay, decrease the volatility or risk of your returns, be backed by an indenture with protective covenants and get paid to wait??