With the risk of a second downturn in the U.S. economy rising and debt problems continuing to plague Europe, many investors are shunning the equities market altogether. Meanwhile, the rush to safety in fixed-income investments has driven yields down to “incredibly low” levels, according to analysts.

In this scenario, the analysts at Morningstar say dividend-paying stocks offer a good alternative that often -- as is the case now -- significantly outperform the S&P 500 and the bond market.

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