---
title: Utility Stocks Deserve Another Look
description: Chart of the Month from March 2023 from Reaves Asset Management.
---

[Chart of the Month](https://insights.reavesam.com/chart-of-the-month)

# [Utility Stocks Deserve Another Look](https://insights.reavesam.com/chart-of-the-month/february-2023)

 Written by [The Investment Team at Reaves Asset Management](https://insights.reavesam.com/chart-of-the-month/author/the-investment-team-at-reaves-asset-management) | Feb 16, 2023 9:32:35 PM

- Utility stocks are ignored by many investors. They are often seen as boring, slow-growth, low-risk investments that, because they provide a reliable income stream, trade like bonds.
- The historical returns of utility stocks deserve respect. As the chart below highlights, not only did utilities outperform the broad stock market over the 50-year period, they did so with a beta of 0.50.

<https://insights.reavesam.com/hubfs/Reaves-Annualized-Total-Return.png>

                 *Sources: Bloomberg, eVestment  
Past performance does not guarantee future results.*

 

- There's also a view that a rising rate environment is an inopportune time to own both bonds and utility stocks. Our research tells a different story — one in which utilities performed far better than bonds. During the 50-year period from January 1973 through December 2022, we identified 273 months when interest rates were trending higher as measured by the 10-year U.S. Treasury yield. The average monthly return of the Dow Jones Utility Average during that period was 0.56%, or an annualized 6.89%, which far outpaced the -0.03% monthly average of the Bloomberg US Investment Grade Corporate Bond Index, or -0.36% annualized during the same period.
- Analyzing the utility sector remains complicated. Successful evaluation demands a deep understanding of the companies, their regulators, and the political environment by an experienced investment team. Learn more about the team of utility experts at Reaves Asset Management managing the [Virtus Reaves Utilities ETF](https://reavesam.com/our_services/reaves-utilities-etf/) and [Reaves Utility Income Fund](http://www.utilityincomefund.com/).

[View full post](https://insights.reavesam.com/chart-of-the-month/february-2023)

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