Well, it finally happened. I’ve been watching oil prices flirt with the $50 mark for some time. On June 7, benchmark West Texas Intermediate (WTI) futures finally pierced through that key psychological level and settled at $50.36 per barrel. That’s the first time oil prices closed above $50 in almost a year. Prices have since retreated slightly since then to around $48, but it’s still a monster comeback. It was only a few months ago that prices were languishing at $26 per barrel. #-ad_banner-#Crude oil dominated the headlines when prices were on the way… Read More

Well, it finally happened. I’ve been watching oil prices flirt with the $50 mark for some time. On June 7, benchmark West Texas Intermediate (WTI) futures finally pierced through that key psychological level and settled at $50.36 per barrel. That’s the first time oil prices closed above $50 in almost a year. Prices have since retreated slightly since then to around $48, but it’s still a monster comeback. It was only a few months ago that prices were languishing at $26 per barrel. #-ad_banner-#Crude oil dominated the headlines when prices were on the way down. But now that the pendulum has turned, the financial media has gone strangely quiet. That’s fine with me. It might allow more time to put additional money to work in this sector while asset prices are still depressed. Could this rally falter and prices retreat again? Sure. We can’t rule out that possibility. But because the upward surge has been driven by improved fundamentals — not speculators — I don’t think we’ll retest the lows again in this cycle. North American oil producers have been dialing back their exploration and production budgets for… Read More

Bill Gross warned investors earlier this month to get ready for an ‘entirely different’ market, and likened the global bond market to a supernova with dire consequences. Global bond yields are at the lowest in recorded history, with more than $10 trillion in bonds priced at negative rates, meaning investors are paying for the right to hold the bonds. Central bank policy doesn’t seem to be supporting economic growth, and many investors are wondering if more modest stock returns might be the norm going forward.  #-ad_banner-#Banks and insurance companies can make do with returns low returns on U.S. government and… Read More

Bill Gross warned investors earlier this month to get ready for an ‘entirely different’ market, and likened the global bond market to a supernova with dire consequences. Global bond yields are at the lowest in recorded history, with more than $10 trillion in bonds priced at negative rates, meaning investors are paying for the right to hold the bonds. Central bank policy doesn’t seem to be supporting economic growth, and many investors are wondering if more modest stock returns might be the norm going forward.  #-ad_banner-#Banks and insurance companies can make do with returns low returns on U.S. government and corporate bonds. For most others, though, that’s not going to cut it. Plunging bond rates have pushed investors into traditional ‘safety’ stocks like utilities and consumer staples in a search for yield. The stampede of investor money has driven prices in these sectors to alarming heights, and may make these safety stocks riskier than investors realize. If weak earnings start to unravel the perception of positive total returns the ensuing investor exodus could cause the whole group to unravel. Two sectors offer a better yield opportunity with cheaper valuations, as well as historical evidence pointing to returns over the next… Read More

There’s an adage that suggests investors should “sell in May and go away.” It’s based on the theory that the market underperforms from May to October. And there have been a few academic studies that have been able to detect a seasonal pattern to market performance. There are common sense reasons why the stock market may languish over the summer months. Fewer stocks get transacted during the summer because more traders and retail investors take vacations. That can make the market more volatile, leading more investors to sell before a potentially bumpy summer. Likewise, many companies tend… Read More

There’s an adage that suggests investors should “sell in May and go away.” It’s based on the theory that the market underperforms from May to October. And there have been a few academic studies that have been able to detect a seasonal pattern to market performance. There are common sense reasons why the stock market may languish over the summer months. Fewer stocks get transacted during the summer because more traders and retail investors take vacations. That can make the market more volatile, leading more investors to sell before a potentially bumpy summer. Likewise, many companies tend to produce less during the summer months, when more of their employees take vacations. It’s been shown that companies are less likely to beat analyst expectations during a seasonally slow quarter. #-ad_banner-#If I weren’t an income investor, maybe I’d rue the summer months like growth investors do. But for me, May has become the month when I start making my watch list for summer purchases. I look forward to any opportunity to buy dividend payers at lower prices and higher yields. And that goes for my automatic dividend reinvestments as well as outright purchases. Read More

We’re approaching a major milestone. More companies are paying dividends, and those payments are getting increasingly larger as a percentage of profits. In fact, payout ratios recently reached 37%, and aggregate dividend payments among S&P 500 companies have totaled $410 billion over the past year. That’s more than $1.1 billion in dividends per day. #-ad_banner-#At least, that’s the official count. The true payout is actually much higher because there are dozens of supplemental dividends that go unreported each quarter. By unreported, I’m not talking about some secret way of transferring cash to a select… Read More

We’re approaching a major milestone. More companies are paying dividends, and those payments are getting increasingly larger as a percentage of profits. In fact, payout ratios recently reached 37%, and aggregate dividend payments among S&P 500 companies have totaled $410 billion over the past year. That’s more than $1.1 billion in dividends per day. #-ad_banner-#At least, that’s the official count. The true payout is actually much higher because there are dozens of supplemental dividends that go unreported each quarter. By unreported, I’m not talking about some secret way of transferring cash to a select group of well-connected insiders. These extra payments are dished out openly and uniformly to all shareholders. But they are considered “special.” As such, these distributions aren’t reflected in the yields you see quoted on popular financial sites like Yahoo or Morningstar. But trust me, the cash is just as green and spends just the same as any other dividend. And these special payments typically come in much bigger denominations, often 10 to 20 times larger than the firm’s regular quarterly dividend. There’s no special trick or complicated system to capturing these dividends — you… Read More

“Sell in May and go away” the old market maxim goes. It may not be far from the truth. That would have been good advice last year. #-ad_banner-#But this year? Who knows? I’ve never been a proponent of getting completely out of the market. As a long term investor, time is always on your side, especially if you’re getting steady, respectable cash flow from your portfolio. If your portfolio is paying you a steady 7% on an annual basis (in income, not capital appreciation) and you go to cash, which is earning you nothing, what are you truly giving up… Read More

“Sell in May and go away” the old market maxim goes. It may not be far from the truth. That would have been good advice last year. #-ad_banner-#But this year? Who knows? I’ve never been a proponent of getting completely out of the market. As a long term investor, time is always on your side, especially if you’re getting steady, respectable cash flow from your portfolio. If your portfolio is paying you a steady 7% on an annual basis (in income, not capital appreciation) and you go to cash, which is earning you nothing, what are you truly giving up for a little comfort from the volatility that comes with owning stocks?  While we may or may not have a summer swoon this year (who knows with an incredibly bizarre presidential election going on), it’s always good defense to not pay too much and get paid decently while you wait. Here are three ideas, all fairly priced and yielding north of 7%. The Blackstone Group LP (NYSE: BX) — With a market cap of over $30 billion, Blackstone is a dominant global player in the alternative investment management business. Focusing on private equity, real estate, hedge fund and other multi… Read More

Over the past few weeks, I’ve shared with readers two crucial types of dividend stocks that make up my three-part Daily Paycheck Retirement Strategy. By using the right combination of dividend stocks, I’ve been able to collect more than $70,000 in… Read More

The upcoming November election is shaping up to be an important and entertaining event. Investors are paying close attention, concerned about the impact the new president might have on the economy. But I believe no matter who wins in November, the incoming president will have limited impact on the economy and the stock market (at least at first). As we’ve seen in the past, presidential decisions can create confidence that leads to a bull market, or they can lead to a sense of malaise and a bear market. But it takes time for sentiment to develop and… Read More

The upcoming November election is shaping up to be an important and entertaining event. Investors are paying close attention, concerned about the impact the new president might have on the economy. But I believe no matter who wins in November, the incoming president will have limited impact on the economy and the stock market (at least at first). As we’ve seen in the past, presidential decisions can create confidence that leads to a bull market, or they can lead to a sense of malaise and a bear market. But it takes time for sentiment to develop and influence the market. The market can ignore the president for a time as traders find other things to focus on, like earnings or economic growth. #-ad_banner-#Right now, the economy is just too big to turn suddenly, and industries are too highly regulated for a new president to simply step in and make sweeping changes. After the election the new president will need time to enact policies, and it will take even more time before they really kick in. Overall, we probably have a year or more after the election to evaluate whether the president… Read More

In a recent issue of StreetAuthority Daily, I told you all about my strategy for maximizing income by investing in stocks that fall in the high-yield ‘sweet spot’. They aren’t the absolute highest yielding stocks on the market, but this special group of stocks has outperformed all others, and returned an average of 14% per year over the past 86 years. And while these stocks are a key part of my portfolio — and consistently provide me ample dividend checks — “maximizing income” is just one aspect of my 3-part Daily Paycheck Retirement System. Read More

In a recent issue of StreetAuthority Daily, I told you all about my strategy for maximizing income by investing in stocks that fall in the high-yield ‘sweet spot’. They aren’t the absolute highest yielding stocks on the market, but this special group of stocks has outperformed all others, and returned an average of 14% per year over the past 86 years. And while these stocks are a key part of my portfolio — and consistently provide me ample dividend checks — “maximizing income” is just one aspect of my 3-part Daily Paycheck Retirement System. #-ad_banner-#I like to call this second group of stocks “Fast Dividend Growers.” These are the few companies that I think you could buy today and potentially hold for the rest of your life. And while you hold them, they can shower you with bigger and bigger dividends year in and year out. These stocks have one very distinct characteristic — Fast Dividend Growers are generally dominant companies with growing cash flows that you can depend on to pay — and increase — their dividends year after year. In other words, you… Read More

When I first began my career at the Chicago Board of Trade, I felt like a newly hatched alligator being released into the wild. I was swimming around much bigger and more experienced animals that wanted to turn me into a quick lunch and take me out of the game. In that ultra-cutthroat environment, where I competed against Goldman Sachs and billion-dollar hedge funds every day, I had very little time to develop my trading technique and confidence. #-ad_banner-#When studying my fellow traders and developing my style, I noticed something important right away. Some… Read More

When I first began my career at the Chicago Board of Trade, I felt like a newly hatched alligator being released into the wild. I was swimming around much bigger and more experienced animals that wanted to turn me into a quick lunch and take me out of the game. In that ultra-cutthroat environment, where I competed against Goldman Sachs and billion-dollar hedge funds every day, I had very little time to develop my trading technique and confidence. #-ad_banner-#When studying my fellow traders and developing my style, I noticed something important right away. Some groups of traders would make money when the market was trending in one direction. On the flip side, there were other groups of traders that would make money when the market was range bound. Few traders could switch hats on a day-to-day basis and play both kinds of markets. Those who could were the real masters of trading. Seeing this pattern of different trading styles winning in certain kinds of markets year after year provided a valuable lesson about trading and investing. It taught me that every trader, or trading system,… Read More

Earlier this month, I shared a question we recently received from a long-time subscriber to The Daily Paycheck — our premium newsletter dedicated to picking the best high-yield opportunities on the market. I also shared Chief Investment Strategist Amy Calistri’s response, along with my comments. Today, I’d like to follow that up with another Q&A. This one pertains to a common strategy investors who are seeking more income use, called “dividend capture.” #-ad_banner-#​ Q: I like quarterly dividends, but I don’t want to wait three months for the checks. Why couldn’t I move from the… Read More

Earlier this month, I shared a question we recently received from a long-time subscriber to The Daily Paycheck — our premium newsletter dedicated to picking the best high-yield opportunities on the market. I also shared Chief Investment Strategist Amy Calistri’s response, along with my comments. Today, I’d like to follow that up with another Q&A. This one pertains to a common strategy investors who are seeking more income use, called “dividend capture.” #-ad_banner-#​ Q: I like quarterly dividends, but I don’t want to wait three months for the checks. Why couldn’t I move from the monthly dividends the day before a quarterly goes ex-dividend and then go back to a monthly for three more months and do it again? What kind of problems would I have other than price adjustments? — Larry N., Indianapolis, Indiana Amy: Fabulous question Larry. The strategy you are describing is called “dividend capture.” Investors move their money from one dividend paying security to another — in an attempt to capture as many dividends as they can. Basically, they swoop in before the ex-dividend date. They… Read More