Considering the uncertainties surrounding the economic recovery and stock market volatility, we believe dividend-paying stocks with stable fundamentals are safer bets because they provide a steady income stream. As such, dividend-paying stocks Rio Tinto (NYSE:RIO) and Ennis (NYSE:EBF) could be solid bets now to hedge one’s portfolio against short-term market fluctuations. Read on to learn more.With the world witnessing a spike in COVID-19 cases due to the rapid spread of the Delta variant, the stock market remains volatile. This, along with uncertainties surrounding the pace of economic recovery and declining Treasury yields, make dividend-paying stocks ideal bets now. That’s because dividend stocks ensure a steady income stream and help reduce portfolio losses caused by market fluctuations.
The CBOE Volatility Index has gained 3.6% over the past month. In addition, Democrat Senator Joe Manchin recently stated that he is "deeply concerned" that the Fed’s additional fiscal stimulus could result in unavoidable inflation and “overheating” of the U.S. economy.
Therefore, we believe fundamentally sound dividend-paying companies Rio Tinto Group (RIO) and Ennis Inc . (EBF) could be great picks now for a stable, passive stream of income.