The 3 Best “Rising Rate Plays” Today for Dividends and Upside

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After a decade in the basement, interest rates are finally starting to move meaningfully higher. Let’s discuss the best stocks and bonds to buy with this backdrop.

If it feels like we had forever to prepare our portfolios for this moment – well, we did. This interest rate run has largely taken place on a treadmill. We’re almost two-and-a-half years into the Fed’s current rate hike cycle, and the Fed Funds rate is up a modest 1.25%.

Meanwhile the 10-year Treasury rate hadn’t really moved until recently. At all. The benchmark long bond now pays 2.86%:

Rates Slowly Grind Higher

If you believe your portfolio is behind the rate hike curve, it’s not by much.…
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Looking for dividend payers with the most price upside? They’re available, even in this pricey market. You just need to follow the free lunch signs…

Five months ago, I told readers to grab the “hurricane dip” in the best reinsurers. My Hidden Yields subscribers specifically were told to buy shares in Validus (VR) on September 15.

Why reinsurance? Why then? And why Validus?

Let’s answer these three questions, because they’re the reason Hidden Yielders woke up to 44% gains last Monday morning (and banked 51% total returns in 5 months).

This “Free Lunch” Was Cashed at Once (for 51% Gains)

(Then I’ll share my top 7 dividend growers with 51% upside by July 4th, too – for those of you who missed our reinsurance party.)

Step 1: Pick a Great Business Model

The first step to successful investing is to buy fantastic businesses.…
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These shareholder-spoiling stocks regularly double or triple their investors’ money. They’re a bit underappreciated, but not often on sale – unless you buy them this time of year.

And on cue, right now they’re as cheap as they’ve been in 12 months.

If insurance is a great business, then reinsurance is a fantastic one. (Reinsurance is insurance purchased by insurance companies to manage their own risk exposure.)

Insurance itself, when done responsibly, is a cash cow. Firms collect payments up front from their customers but may not have to pay it out in claims for a long time, if ever. The companies then invest that money – called “float” – and pocket the income they earn.…
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About Author

Brett

Hi, I’m Brett Owens – and I’m a financial junkie. My “problem” started incollege, when I got a little dose of the stock market – man, was I hooked…in no time, I was reading the Wall Street Journal religously.

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