Investors hate this industry. Pension funds do, too.

In fact, the industry is so hated that some funds aren’t allowed to own the companies involved.

But for the last 115 years, these companies have been the best performing stocks in the United States — despite stiff competition from sectors like healthcare, technology and energy.

And today, while most investors shun these stocks, you could use them to earn more than 20% annualized.

And here’s the best part… you won’t even have to buy shares.

Let me explain.

Investment bank Credit Suisse recently conducted a study on the best-performing industries in the United States since 1900.

Here’s what they found: One dollar invested in the U.S. stock market in 1900 would have been worth $35,255 at the end of 2014. That comes out to an average annual return of 9.6%. Not bad.

However, one dollar invested in the tobacco industry in 1900 would have ballooned to $6.28 million by the end of 2014. That’s an average annual return of 14.6%.

No other industry has come even close to delivering that kind of return.

The second-best performing group was electrical equipment, but tobacco outperformed these stocks by a factor of 10. It outran the market average by more than 15 times, and it beat the worst-performing industry, shipbuilding, by more than 5,000 times.

So how has the industry been so dominant?

There are two reasons why tobacco has delivered better returns than all other industries in the last 115 years.

1. Tobacco Stocks Are Great Dividend Payers
Since 1926, dividends have accounted for one-third of the S&P 500’s total return according to ratings agency Standard and Poor’s. And the tobacco industry has historically been one of the best dividend payers in the market.

Lorillard, one of the biggest tobacco players, has raised its dividend by 88% in just the last five years. Reynolds has increased its dividend by 51%, while Altria has boosted its dividend by 48%

Together, these three companies yield about 3.7%. That’s a 100% premium to the S&P 500’s 1.9%.

2. The Tobacco Industry Has Little-To-No Innovation
Investors are naturally attracted to innovative industries. In the short run, investing in an innovative company such as Apple or Microsoft can be very profitable. But history has clearly demonstrated that innovative companies can easily fall victim to new competition.

Just look at what happened to Research In Motion (makers of the Blackberry smartphone). The company was the number-one mobile phone provider a few years ago. Today it’s irrelevant.

The tobacco industry, on the other hand, has barely changed in the last 115 years. The same companies that were in business a century ago are still in business today, just operating under different names.

That lack of innovation is great for investors because these companies are not threatened by waves of new competition or the hottest new trends in technology.

Together, these two factors have been the driving forces behind tobacco’s impressive run. I don’t expect either to change any time soon.

For savvy investors looking for income, the stability of the tobacco industry is music to the ears.

Forget Buy And Hold, This Strategy Is Even Better
Now, you couldn’t go wrong with simply buying these reliable companies, collecting their rich dividends and owning them for the long haul. But if you’re looking for even more income, consider the Income Multiplier strategy I outlined for readers last month.

With my strategy, we don’t need stocks to zoom higher to make money. In fact, they don’t even need to move higher at all.

#-ad_banner-#We simply need these tobacco stocks to do what they do best: not fall.

Even if the economy weakens and consumer sentiment wanes, tobacco sales and tobacco stocks are likely to hold steady.

That’s why I’m so excited about the company I recently recommended to readers of my Income Multiplier service.

By using the same strategy Warren Buffett used to earn a $7.5 million payday from Coca-Cola, we’ll make a quick 5.6% payout on our investment. That’s even better than what traditional buy-and-hold investors will get over 12 months — and we’ll do it without having to buy a single share of stock.

But it gets even better. If we repeat this process, we can earn a similar payout again and again.

Unfortunately, out of fairness to paid-up subscribers, I can’t reveal the name of this company here. This is the kind of opportunity they pay good money to learn about.

To tell you the truth, as I mentioned earlier, you can’t go wrong with any of these big tobacco names. You can buy them, hold them and collect their rich dividends for years to come.

But if you’re interested in earning even more income in a shorter amount of time, then I encourage you to learn more about my Income Multiplier strategy. My readers and I are earning annualized income of up to 36% — equaling thousands of dollars a month.

To learn more about how easy multiplying your income can be, you can watch my free presentation here.