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Street: High-yield stocks won't take a Fed hit

Traders work on the floor of the New York Stock Exchange.
Brendan McDermid | Reuters
Traders work on the floor of the New York Stock Exchange.

Barclays this week joined a growing list of Wall Street firms directing clients to buy high-yielding stocks even with the Federal Reserve so close to raising interest rates.

"Dividend strategies deserve a fresh look," Barclays' Jonathan Glionna said in a note to clients Tuesday, suggesting this year's selloff in the group may be overdone.

An index of real estate investment trusts (REITs) is down big in 2015, off 11 percent from an all-time high in January, on expectations that a rise in rates will make bonds a more attractive option than these high-yielding securities.

Wall Street strategists are saying now that these stocks have fallen too far, too fast considering rates won't likely move that much higher even when the Fed decides to hike.

Also history shows that rising rates don't hurt REITs by as much as you would think.

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