The S&P/ASX 200 Index (ASX: XJO) has had a bumpy year in 2026.
Inflation and interest rate fears and global conflict have all weighed on investor sentiment.
When markets experience volatility, investors may choose to rotate into dividend shares.
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Why turn to income/dividend shares?
Income and dividend investing can be a viable strategy during periods of market volatility because it emphasises generating consistent cash flow rather than relying solely on rising share prices for returns.
Companies that pay regular dividends are often established businesses with stable earnings, strong balance sheets, and resilient business models, which can help reduce portfolio volatility compared with more speculative investments.
Reinvested dividends can also enhance long-term returns by allowing investors to purchase additional shares, particularly when prices are temporarily lower during market downturns.
While dividend-paying stocks are not immune to market declines and dividend payments are never guaranteed, a disciplined income-focused approach can provide a measure of stability, support long-term wealth accumulation, and help investors remain invested through uncertain market conditions.
For those looking for a competitive yield in today's climate, here are three options to consider.
Regal Partners Ltd (ASX: RPL)
Regal Partners have been attracting positive analysis from experts over the past month.
Its recent 1H26 earnings update included a big jump in profit and record net inflows, boosting FUM to new highs.
The residential aged care services provider is forecast to pay a dividend of around 8% this year, followed by 6.9% and 7.8% in the following years.
Additionally, the team at Morgans recently placed a $4.00 price target on this dividend stock.
This suggests investors could enjoy a high yield and strong capital gain over the next 12 months.
Dexus (ASX: DXS)
Another option for investors to consider is Dexus.
It is a major Australian real asset group, with a platform spanning listed property, funds management, infrastructure, alternatives, and other investments.
This ASX dividend stock is offering a yield over 6%, well above the average yield for ASX 300 companies.
It may suit investors who are comfortable with commercial property exposure.
Additionally, it can provide portfolio diversification alongside typical bank, utility, and infrastructure dividend stocks.
IPH Ltd (ASX: IPH)
IPH provides intellectual property (IP) services.
Its network of subsidiaries includes global IP brands AJ Park, Griffith Hack, Pizzeys, Robic, Smart & Biggar, and Spruson & Ferguson, as well as IP business Applied Marks.
Despite facing some share price pressure in recent times, it has a reputation as a reliable income stock.
It has paid regular semi-annual dividends to shareholders for years, with its current yield sitting around 9%.
