Make This Fatal Dividend Mistake and You Could Miss a $70,000+ Gain

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Markets took a dive (then posted a lightning-fast recovery) last week, a return to volatility that’s a good reminder to cast an eye over our dividend portfolios.

One thing to pay particular attention to is the amount of cash you’re holding. Because if you’re like many investors I’ve talked to recently, you’re holding too much of it—and that can cause a steady wealth drain that bleeds away thousands in returns every year!

Taking Money Off the Table—at Exactly the Wrong Time

Of course, having a healthy cash cushion is always a good thing. The trouble for most folks, though, is that they’ve been growing the amount of cash they have outside the market just as stocks have taken off.… Read more

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For income investors, dividend strategies don’t come any easier than the “Dogs of the Dow.”

But does this simple technique still work?

We’ll look at the 2021 Dogs, and their attached dividends (and prospects) in a moment. Their yields aren’t too shabby, averaging 4.1% in a 1% world! First, let’s review the mechanics of the popular contrarian strategy:

  • Step 1: After the final trading day of the year, we identify the 10 highest-yielding stocks in the Dow.
  • Step 2: We buy all 10 in equal amounts.

That’s it. In just a couple of quick steps, executed just once every year, we can put together a mini-portfolio of 10 blue-chip stocks that typically out-yield the S&P 500, and currently offer 2.5 times more dividends than the broad market index.… Read more

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Successful dividend investing can actually be pretty simple. Don’t trade for years, perhaps for a full decade, and then buy super high-quality dividend stocks at bargain basement prices.

One set of trades every decade. Not bad.

It’s the way of the world. There’s always something brewing. From the “original crash” of modern times, 1987, to the tech bubble bursting in 2000 or the financial world nearly collapsing in 2008.

Now, it’s 2020, and the world is again ending. We’ll make it to the other side, of course, but between here and there we are going to have a fantastic opportunity to buy blue-chip dividends.… Read more

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The New Year is here, which means it’s once again time to revisit a contrarian (and income) investing tradition: The “Dogs of the Dow.”

This simple yet famous dividend strategy involves buying the 10 highest yielders in the 30-component Dow Jones Industrial Average at the beginning of each year.

It’s an income play, sure, but this strategy also has to do with value. The idea: Truly strong blue-chip stocks rarely become “obsolete,” so high yields—often driven by lower prices in the prior year—are just a signal that the stocks are oversold and due to bounce back.

It’s a win-win, in theory.… Read more

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The Nasdaq Composite and S&P 500 indexes set new record highs on Tuesday, as first-quarter earnings continued to exceed low expectations this week. The rally this week completed a sharp 25% comeback in the S&P 500 that started when U.S. markets bottomed during the last week of December.

There was strong economic data reported in the U.S. this week, highlighted by a blowout first-quarter GDP reading on Friday. We experienced 3.2% growth in the domestic economy last quarter, which smashed the estimate of 2.5%.

New home sales were another beacon of light on Tuesday, showing a 3% increase for March. The print exceeded expectations and marked the highest level in 17 months.… Read more

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The broader stock market averages digested recent gains this week, as trading activity was shortened by the Martin Luther King Jr. holiday on Monday.

Trade talks with China appear to have reached a stalemate, as U.S. Commerce Secretary Wilbur Ross said on Thursday that the two sides were “miles and miles” apart from settling trade issues. Back at home, the Federal government shutdown found a temporary solution on Friday. The deal re-opens government operations through Feb. 15, as Congress and the White House will continue to discuss border security.

Earnings Season in Full Force

Despite the holiday, it was a busy week for earnings.… Read more

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If you’re not yet as rich as you hoped you’d be by now, don’t worry – we still have plenty of time to get you there.

And I’m not talking about investing your “growth capital” into risky fly-by-night names like Tesla (TSLA) and Snap (SNAP).

We can scale our money more securely – but just as spectacularly – by purchasing sound dividend payers that happen to be growing their payouts rapidly. Here’s why.

The Most Lucrative Way Shareholders Get Paid

There are three – and only three – ways a company’s stock can pay us:

  1. A cash dividend.
  2. A dividend hike.

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Last week, I showed you a smart monthly income strategy that hands you $3,333 a month on a $500k investment—all in dividends alone.

This easy monthly dividend setup works out to an average 8% yield (or $40,000 a year on our $500k) paid out to you every 30 days like clockwork.

I think you’ll agree this is plenty of cash for many people to clock out on. So today we’re going to talk growth.

Because our $3,333-a-month “8% strategy” already crushes Wall Street’s flawed 4% rule. You know the one: it recommends that you draw down 4% of your nest egg a year by selling stocks to supplement your dividend income.…
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Have you always wanted to buy a safe stock like Coca-Cola (KO) and get rich from it like Warren Buffett?

It’s doable. But most investors “live in the past” and fixate on dividend track records rather than a payout’s forward prospects. And looking ahead is the key to yearly gains of 10%, 15% or even 20% or more with dividend aristocrats.

Let’s look at Coke, which achieved its dividend royalty status in 1987 (its 25th straight year with a dividend hike). The firm hit its coronation with a head of steam, rewarding investors with a 362% payout hike in just five years (from 1986 to 1991).…
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You and I both know that dividends just don’t get much respect from most folks.

But most folks have it all wrong. I’ll show you why in a moment (I’ll also reveal 2 “accelerating” dividends to put on your buy list now).

First, it’s easy to see why dividends are (way too often) an afterthought: it’s tough to get excited about them when the typical S&P 500 name dribbles out the measly 1.9% yield it does today.

It gets worse when you look at the US inflation rate: 2.1% as of March.

So at best, you can hope your dividends offset inflation, while you hope the underlying stock price soars.…
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