To consistently earn the highest returns, financial advisors often recommend using a low-cost fund that tracks the S&P 500 since there’s only perhaps a 30% chance of beating the index over time with actively managed investments.  #-ad_banner-#That’s all well and good if you’re a growth investor, but what if your goal is to maximize your dividend yield without taking any undue risk? In that case, tracking the market definitely isn’t the way to go. One of the most popular funds that does this, SPDR S&P 500 (NYSE: SPY), yields a meager 1.9%. And it comes with all the… Read More

To consistently earn the highest returns, financial advisors often recommend using a low-cost fund that tracks the S&P 500 since there’s only perhaps a 30% chance of beating the index over time with actively managed investments.  #-ad_banner-#That’s all well and good if you’re a growth investor, but what if your goal is to maximize your dividend yield without taking any undue risk? In that case, tracking the market definitely isn’t the way to go. One of the most popular funds that does this, SPDR S&P 500 (NYSE: SPY), yields a meager 1.9%. And it comes with all the stomach-churning volatility you typically see in the broader stock market. That’s why income investors so often turn to sectors known for generous dividends — like telecommunications. Stocks in this sector often boast yields well north of 3%, and many are far less volatile than the market. The big question is which are the best ones to own? My answer: Why not own them all through an ETF? That way, you’ll be well-diversified across the sector but still able to enjoy attractive yields. In my opinion, the #1 choice for the job is Vanguard Telecom Services ETF (NYSE: VOX). The $673… Read More

With its constant ups and downs, investing in stocks is like a roller-coaster ride. Investing in bonds, on the other hand, usually isn’t — especially during the bond bull market of the past 15 years.  While bond investors love to complain about the pitifully small income stream bonds provide these days, they’ve grown accustomed to growing and stable principal values. But that era of good feelings is probably over. Bull markets ALWAYS come to an end — and it appears this time is no different.  As the Federal Reserve telegraphed its “tapering” plans and even hinted at higher… Read More

With its constant ups and downs, investing in stocks is like a roller-coaster ride. Investing in bonds, on the other hand, usually isn’t — especially during the bond bull market of the past 15 years.  While bond investors love to complain about the pitifully small income stream bonds provide these days, they’ve grown accustomed to growing and stable principal values. But that era of good feelings is probably over. Bull markets ALWAYS come to an end — and it appears this time is no different.  As the Federal Reserve telegraphed its “tapering” plans and even hinted at higher federal funds rates, the bond market responded accordingly: It went down. This price chart of the iShares Barclays 20+ Year Treasury Bond Fund ETF (NYSE: TLT) paints a clear picture. #-ad_banner-#At the height of “Taper terror,” shares plunged over 15%. Prices have recovered, but don’t expect a quick return to the bond glory days. If anything, investors should prepare for more volatility. The challenge that investors face daily is the need for income and some type of bond or bondlike allocation to a portfolio. For example, as an investment professional, I manage a handful of different investment strategies… Read More

As we enter earnings season for the first quarter of 2014, we are also seeing a number of 13F filings roll out ahead of the May 15 deadline as well. #-ad_banner-#These SEC forms outline a fund’s long-only equity positions (as well as some debt and option trades) but omit short and international positions. However, we’re still often able to get a good idea of a fund’s portfolio depending on its investing methodology. The California Public Employees Retirement System is one such asset manager whose 13F can provide a fair amount of clarity to retail investors.  … Read More

As we enter earnings season for the first quarter of 2014, we are also seeing a number of 13F filings roll out ahead of the May 15 deadline as well. #-ad_banner-#These SEC forms outline a fund’s long-only equity positions (as well as some debt and option trades) but omit short and international positions. However, we’re still often able to get a good idea of a fund’s portfolio depending on its investing methodology. The California Public Employees Retirement System is one such asset manager whose 13F can provide a fair amount of clarity to retail investors.   CalPERS is the largest public pension fund in the U.S., carrying a staggering market value of $288 billion as of this month. Capital is divided across strategies emphasizing growth, income, liquidity and real assets, among others. Its equity holdings posted a gain of 25.6% last year, with total assets gaining 16% in 2013, the largest appreciation in 11 years. Why are retirement funds good vehicles to emulate? Particularly in a post-recession world, public pension funds take a more risk-averse stance than other volatile investment vehicles. While hedge funds may take more speculative positions with a larger percentage of their capital,… Read More

It started out as an experiment. It wound up being one of the greatest investment discoveries we’ve ever found. #-ad_banner-#Less than five years ago, StreetAuthority co-founder Paul Tracy approached me with an idea. He wanted me to build a portfolio of dividend stocks that would pay out more than 30 dividend checks a month — one for every day of the year. In order to show he was serious, he gave me $200,000 and a dedicated brokerage account to get started. I must admit, I was a little skeptical at first. The idea… Read More

It started out as an experiment. It wound up being one of the greatest investment discoveries we’ve ever found. #-ad_banner-#Less than five years ago, StreetAuthority co-founder Paul Tracy approached me with an idea. He wanted me to build a portfolio of dividend stocks that would pay out more than 30 dividend checks a month — one for every day of the year. In order to show he was serious, he gave me $200,000 and a dedicated brokerage account to get started. I must admit, I was a little skeptical at first. The idea seemed too good to be true. But less than five years, more than 1,574 dividends and over $65,000 worth of dividend income later, the results have been far better than anyone could have imagined. Since I started my portfolio back in December 2009, my initial $200,000 investment has grown to more than $310,000, giving me a total return of more than 55% in less than five years. The total dividends I’ve received amount to more than $65,000. Even better, during the past year, I’ve earned nearly $17,000 in dividends, amounting to $1,382 a month. Read More

There’s no other way to put it. If you’re a dividend investor, chances are you’ve been duped… As an experiment, I ran a simple stock screen. Out of 14,266 stocks and ADRs listed on U.S. exchanges, just 181 offer yields above 9%. And most are questionable companies like over-the-counter stock Xstelos Holdings (OTC: XTLS), which, incidentally, has lost 47% of its value over the past year. That means 14,085 stocks pay less than 9%. In other words, less than 1% of stocks are double-digit yielders today. But that’s just the start… Right now the average dividend yield of a given… Read More

There’s no other way to put it. If you’re a dividend investor, chances are you’ve been duped… As an experiment, I ran a simple stock screen. Out of 14,266 stocks and ADRs listed on U.S. exchanges, just 181 offer yields above 9%. And most are questionable companies like over-the-counter stock Xstelos Holdings (OTC: XTLS), which, incidentally, has lost 47% of its value over the past year. That means 14,085 stocks pay less than 9%. In other words, less than 1% of stocks are double-digit yielders today. But that’s just the start… Right now the average dividend yield of a given stock trading on U.S. exchanges is 2.2%. That’s less than half of the historical average, which comes in at 4.45%. See for yourself… #-ad_banner-#Where have all the dividends gone? While it wasn’t easy to find, months of research finally led to an answer. Most investors aren’t being told about the two “extra” payment methods a handful of dividend-paying companies are using. Unlike dividends, these extra payment methods are under the radar, buried in company financial statements. But find the right companies that pay them, and you could get returns up to three times higher than you could from… Read More

Several years ago, when I was looking for exposure to rising oil prices, I spent quite a bit of time searching for bargains in the energy sector. After examining the various investment options available, I developed a game plan for the next couple of decades. #-ad_banner-#I call it my unconventional plan, because it involves investing in oil producers focused almost exclusively on unconventional (horizontal) production. The plan looks like this: 1.) Find unconventional producers that appear reasonably (or cheaply) valued based on current reserves and production. 2.) Focus on those that have the biggest land positions in… Read More

Several years ago, when I was looking for exposure to rising oil prices, I spent quite a bit of time searching for bargains in the energy sector. After examining the various investment options available, I developed a game plan for the next couple of decades. #-ad_banner-#I call it my unconventional plan, because it involves investing in oil producers focused almost exclusively on unconventional (horizontal) production. The plan looks like this: 1.) Find unconventional producers that appear reasonably (or cheaply) valued based on current reserves and production. 2.) Focus on those that have the biggest land positions in these horizontal oil plays relative to their enterprise value. 3.) Sit back and wait as the technology and techniques being used by these unconventional producers continue to evolve. Horizontal drilling with multi-stage fracturing is still in its infancy, and I expect future improvements on current techniques will allow for a lot more oil to be recovered than anyone expects. 4.) Enjoy the added benefit of rising oil prices making all of the oil that these companies sit on top of more valuable. Crescent Point Energy (NYSE: CPG) is the premier horizontal oil producer in… Read More

Because no one can predict the future with 100% accuracy, spotting tomorrow’s best income-producing blue-chip stocks today is extremely difficult.  #-ad_banner-#However, I recently profiled one company I strongly believe is well on its way to achieving blue-chip status — filtration technologies manufacturer Pall Corp. (NYSE: PLL) — and there are several others I think have the same type of potential. Aside from being in retail, these three companies aren’t much alike. One is a sodium bicarbonate maker best known for the Arm & Hammer brand, and the second is a leading discount clothing chain based in California. The third has… Read More

Because no one can predict the future with 100% accuracy, spotting tomorrow’s best income-producing blue-chip stocks today is extremely difficult.  #-ad_banner-#However, I recently profiled one company I strongly believe is well on its way to achieving blue-chip status — filtration technologies manufacturer Pall Corp. (NYSE: PLL) — and there are several others I think have the same type of potential. Aside from being in retail, these three companies aren’t much alike. One is a sodium bicarbonate maker best known for the Arm & Hammer brand, and the second is a leading discount clothing chain based in California. The third has carved out a profitable niche as a provider of farm and ranch supplies in rural areas. One thing they do have in common, though: Their dividends have been growing really fast — more than 50% a year, in one case — for some time now. And that’s just one of the main reasons I think that all three companies, like Pall Corp., are on track to take their place among the world’s best dividend-paying blue-chip stocks. These three stocks also display other key characteristics of up-and-coming blue chips such as strong balance sheets, sustainable payout ratios, ample cash flows, and… Read More

They’ve officially become more popular than dividends. Top companies are shelling out these extra payments in droves. The goal is to give shareholders more bang for their investment buck than dividends alone. They are a favorite of Warren Buffett and many other billionaire investors. #-ad_banner-#There’s a good chance you’ve received one of these “tax-free dividends” before and didn’t even realize it. That’s because they’re buried in a company’s financial statement. But since 1982, when the SEC enacted a rule called 10b-18 as a measure of boosting the economy, these “tax-free dividends” have become a favored form of payment among shareholders. Read More

They’ve officially become more popular than dividends. Top companies are shelling out these extra payments in droves. The goal is to give shareholders more bang for their investment buck than dividends alone. They are a favorite of Warren Buffett and many other billionaire investors. #-ad_banner-#There’s a good chance you’ve received one of these “tax-free dividends” before and didn’t even realize it. That’s because they’re buried in a company’s financial statement. But since 1982, when the SEC enacted a rule called 10b-18 as a measure of boosting the economy, these “tax-free dividends” have become a favored form of payment among shareholders. And companies have responded. Just look at the chart below to see how companies have been paying shareholders since 1982, especially since 2005 (hint: it hasn’t been just with traditional dividends)… Now, not every company pays these “tax-free dividends.” So just which companies are making these extra payments… and how can you start receiving them today? The easiest way to identify which companies are making “tax-free dividend” payments is to explain the payment method itself. As I mentioned, its roots trace back to 1982. It was an awful time for the U.S. economy. We were in a recession,… Read More

They say there is power in numbers, and when it comes to investing like the pros, that sentiment is right on the money. #-ad_banner-#One of my favorite analytical methods is to find stocks that possess as many professional “endorsements” as possible. These stocks not only have impressively high yields, but they are also well-represented in the portfolios of the world’s investing elite. The beauty of today’s hedge fund regulations mean that managers are required to disclose their long positions every quarter, allowing investors of all sizes access to detailed insight into what a manager is holding.  Some of… Read More

They say there is power in numbers, and when it comes to investing like the pros, that sentiment is right on the money. #-ad_banner-#One of my favorite analytical methods is to find stocks that possess as many professional “endorsements” as possible. These stocks not only have impressively high yields, but they are also well-represented in the portfolios of the world’s investing elite. The beauty of today’s hedge fund regulations mean that managers are required to disclose their long positions every quarter, allowing investors of all sizes access to detailed insight into what a manager is holding.  Some of the disclosures are intentionally vague or “padded” to decrease transparency, but there are ways to glean actionable info from these filings, known as 13Fs. (My StreetAuthority colleagues and I have written about 13F’s on several occasions already this year.) One of my favorite investment strategies is to collect the filings of a number of successful managers (read: billionaires) and see where their investing methodologies intersect. Long-term investors like Warren Buffett have reaped the benefits of high-paying dividend stocks for years, and those securities should be favorites in the portfolios of those with a greater time horizon in mind. That said,… Read More

Quick, what is one of the most positive cash flow businesses with high revenue margins? If you guessed insurance, give yourself a pat on the back. Through its subsidiaries, Lincoln National (NYSE: LNC) offers a variety of insurance products and retirements services, such as annuities, life insurance, group insurance, wealth protection and retirement income products. LNC offers those products through consultants, planners, brokers, agents, financial advisors and other third parties. In the past year, shares are up roughly 40%. On Feb. 3, as the Dow Jones Industrial Average plunged 326 points on emerging-market worries, LNC fell nearly 5%, closing… Read More

Quick, what is one of the most positive cash flow businesses with high revenue margins? If you guessed insurance, give yourself a pat on the back. Through its subsidiaries, Lincoln National (NYSE: LNC) offers a variety of insurance products and retirements services, such as annuities, life insurance, group insurance, wealth protection and retirement income products. LNC offers those products through consultants, planners, brokers, agents, financial advisors and other third parties. In the past year, shares are up roughly 40%. On Feb. 3, as the Dow Jones Industrial Average plunged 326 points on emerging-market worries, LNC fell nearly 5%, closing at $45.78. As you can see in the chart, the former resistance line acted as support. Two days later, the company reported better-than-expected fourth-quarter operating earnings of $1.40 a share, compared with estimates of just $1.10, and shares bounced on the news. They continued to climb, hitting a multi-year high of $53.26. Since that peak, LNC is off more than 13% and testing support at its 200-day moving average. Traders can capitalize on this pullback and even get in another 4% lower with today’s trade. On the fundamental side, the trailing price-to-earnings (P/E) ratio is around 10 based on diluted… Read More