If you must have exposure to gold, which isn’t the greatest idea based on its run, the miners may be the way to do it. Of course our biggest beef with gold has always been that it pays the owner precisely bubkus. Some of the miners may throw off a dividend which is always nice.

Our idea, though involves writing (selling) call options against the long position of the equity. With the crazy price of gold, out of the money premiums have been quite sexy which is always a plus with underperforming equity prices.

Source: Yield Pig

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Summary only...

Last week saw a number of large-cap dividend payers step up their payouts to shareholders -- a significant change because those same firms had been notably absent from our weekly lists during the first couple weeks of November. With record cash in corporate coffers, investors have been egging on corporate management teams to return value to shareholders in the form of dividend checks, and a growing number of companies are listening.

Over the last 36 years, dividend stocks outperformed the rest of the S&P 500 by 2.5% annually, and they outperformed nonpayers by nearly 8% every year, all while paying out cash to their shareholders, according to a study from NDR. And right now, companies that are willing to part with cash in arguably tough times are worth a second look.

Source: TheStreet.com

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Summary only...

Initially, fast-growing companies that do initiate a dividend will often start out with single digit payout ratios. However, over time, as they morph from a pure growth stock into a growth and income stock, their payout ratios will tend to increase. As a result, their dividend yields will usually be lower starting out, but grow faster than a stalwart’s dividend normally would. Furthermore, if and when their growth begins to slow, their payout ratios will often increase. Therefore, what we call growth yield, and others refer to as "yield on cost", has the potential to increase rapidly over time.

A few words in favor of the dividend payers are in order. Since fast growing companies tend to be riskier than slower growers, risk should always be a consideration. One advantage that a dividend paying stock offers is both the return of and the return on capital invested. With each dividend paid, the investor has less capital at risk, and therefore, each dividend payment reduces risk. Consequently, a strong case is made that the dividend payers produce similar returns with lower risk taken.

Source: Seeking Alpha

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Summary only...

Wwith Washington likely to be gridlocked the next couple years, companies can look forward to a period of relative stability on the tax and regulatory front. And dividend-paying equities are cheap, trading at big discounts to bond prices and interest rates despite reviving payout growth.

Unfortunately, market history shows clearly that each of today’s major worries has the potential to trigger a sizeable selloff, if things go wrong enough. Consequently, it’s more critical than ever for investors to follow the scouting motto with their portfolios: Be prepared.

Source: Investing Daily

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Summary only...

Rule One of conservative investing: In a 2- to 4-per-cent world, you can’t get 7 per cent without taking on some extra risk. Rule Two is that some investors will forget Rule One and end up hurting themselves.

So let’s have a lesson on the risks of trying to do better than bonds, guaranteed investment certificates and blue-chip dividend stocks using a real-life product called Dividend Select 15. It’s a closed-end fund. Dividend Select 15 holds 15 stocks drawn from a master list of 20 high-yielding, true blue-chip names. Ms. Payne noted that the fund will use only a limited amount of covered call writing. But at today’s volatility levels, she said, the fund could probably generate more income through this strategy than it actually needs to maintain the 7-per-cent yield.

Source: Globe and Mail

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Summary only...

Like many investors, you may be searching for portfolio income outside of the realm of bonds. Equity income is a reasonable place to look. Cash provides negligible income and is losing money in real terms after inflation, modest though it may be. Bonds have begun to turn negative and the prospects of bonds rising in price dims further each day. Very possibly, one good place to find income now is in higher yielding stocks that might serve as bond substitutes for part of your portfolio.

We've been accumulating high yield dividend stocks for months now as we see a necessary rotation and allocation away from bonds. Dividends have the general probability of rising over time, whereas traditional bond coupons don't. Dividends can and do decline or get suspended altogether in some circumstances, so it is important to look for long and consistent patterns of dividend payment, and to diversify among industries.

Source: Seeking Alpha

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Summary only...

In some ways, the dividend actions by companies provide investors with insight into management and the board's expectations of a company's future earnings prospects. This valuation methodology is what led to using the "dividend discount model" as a way to value companies. Importantly, the DDM can further be used to relate the value of a stock to a company's fundamentals.

Generally, companies do not want to reduce or slow their dividend growth rates as investors in these types of companies have come to expect a certain level of dividend growth or income growth. If the growth rate slows or other financial ratios begin to trend in the wrong direction due to a company's desire to maintain a certain dividend growth rate, this provides investors with important insight into the future return potential for a stock. Additionally, as noted in a recent research report by Fidelity's Market Analysis, Research & Education group, dividends are a critical component of a stock's overall return.

Source: Disciplined Approach to Investing

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Summary only...

Why are investors suddenly so fixated on dividends? A week ago, I took a look at what economist Gary Shilling had to say about the economy and the investment landscape. It wasn't pretty, but I think he has a pretty good handle on why many investors are turning to dividends -- namely, they are concerned that capital gains will be hard to come by in the years ahead, and they believe they'll have to count on dividends for most of their returns.

More generally, though, I think investors have had the fear of God put in them by the recent crash, and after seeing their accounts decimated and valuations go haywire, they like the idea of tangible returns. And dividend payments that roll in every quarter are nothing if they're not tangible. Now, today, the world is a changed place, a bleaker place, and dividends are now the investment must-have. But it won't last. As a broad group, investors are a fickle bunch that tend to jump on the latest trend faster than you can say "Justin Bieber."

Source: Motley Fool

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Summary only...

About 10 years ago, retired political science professor Mike Henderson singled out these companies for the essential roles they play in the Canadian economy. He then invested in each of them for the core of the retirement savings he and his wife would rely on. The cumulative average 10-year total return on these stocks (that’s share-price gains plus dividends) was 305 per cent, far better than the 72-per-cent gain for the S&P/TSX composite index.

“The idea just came to me, and it was blazingly simple,” he said from his Toronto home. “I basically sat down and thought, what is absolutely essential to our society, and who provides those essentials?” Don’t confuse what we’ll call the Essentials Portfolio with companies that are “too big to fail,” an idea that proved faulty after the global financial crisis took down the likes of Lehman Brothers and Merrill Lynch. Mr. Henderson’s focus is on the function of a company, not its size. The first step in building the portfolio was to set a rule that all stocks had to pay a dividend. As a retiree, dividend income is essential to Mr. Henderson.

Source: Globe and Mail

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Summary only...

We recently completed an analysis to determine how companies with rising dividends have fared during the last three years, a time when overall dividend payments by S&P 500 companies were falling. We divided all dividend-paying companies in the S&P 500 Index into quintiles ranked according to their average annual dividend growth over the past three years. A sixth group consisted of those companies that do not pay dividends. We then computed the average total rate of return for each quintile over the three years.

The results are impressive and a bit surprising. The seventy companies with the highest average annual dividend growth rates over the past three years have outperformed 58% of all stocks in the S&P 500. By contrast, the companies with the lowest average annual dividend growth rate (actually a loss) only outperformed 28% of the stocks in the S&P 500. In looking at both dividends and earnings we see that high growth has not been rewarded with proportionately higher price growth. This is the primary reason that we now believe the sweet spot of the stock market is in the high dividend and earnings growth companies.

Source: Rising Dividend Investing

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Summary only...

With yields low and prices high, it's time to rethink bonds as your safe bet, experts say. No one can time the Fed's decision, but one move you might make in preparation is to shift part of your bond portfolio into dividend-paying stocks. While stocks are inherently riskier than bonds, these shares are generally less volatile than other types of stocks and in many cases offer income-hungry investors attractive yields relative to bonds. They tend to do well in a rising rate environment, which is usually a sign that the economy is picking up.

When the economic picture improves, companies generally raise their dividend payouts slowly over time, says Howard Silverblatt, senior index analyst at Standard & Poor's. "Overall, you're looking at a positive scenario." The number of companies raising their dividend was up 57 percent during the third quarter over the same period last year, according to S&P.

Source: U.S. News & World Report

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Summary only...

The lure of dividends is always there. Even the novice stock trader notices that certain stocks move down suddenly on their ex-dividend date, and realizes that holders of that stock just received a tidy cash payment. It is no surprise that every trader, perhaps tired of fighting win-one lose-one battles in the volatile high-beta stocks, is eventually tempted to try the slower moving dividend stocks with their predictable payments. But to the trader, a strategy of simply buying and holding is not interesting enough. The trader wants to trade.

This leads to the strategy of Dividend Capture. In this strategy the dividend trader seeks to obtain the full dividend payment while minimizing the time during which the stock must be owned. The dividend stock, like any stock, has a risk of ownership, and the fewer days the stock is owned the lower the risk. The least time is one night -- that is, the stock is bought in the closing minutes of the trading day before the ex-dividend date (the mo-date, or "must-own date"), then sold at the first profitable opportunity, perhaps even early the next morning.

Source: My Happy Trading

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Summary only...

Although it's nice to get paid to invest, it's not just the fact that Wal-Mart and the other analysts' suggestions pay a dividend, it's what that often indicates. As Income Investor advisor James Early said, he's trying to make his readers as much money as possible, "and study after study proves that dividends make that happen -- and give you the option of reinvesting to pursue bigger gains or taking the money as it comes. One study from Ned Davis Research shows that from 1972 to 2006, S&P 500 stocks not paying a dividend returned a measly 4.1% annualized. Dividend payers, meanwhile, returned a whopping 10.1% annually!"

A dividend is often a sign of a company's overall health. Wal-Mart and the others mentioned below certainly don't have the highest yields on the market, but they are all strong businesses that are well-positioned for steady growth and seem poised to increase their dividends. It's not a ranking nor a definitive, exhaustive list, but these are a handful of companies that make Foolish investors smile, either as investments right now or to keep an eye on.

Source: Motley Fool

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Summary only...

Dividend payers -- many of which are stable, larger-cap companies -- offer ballast to any portfolio. Through booms and busts, the underlying companies will keep paying you as long as they remain healthy. The best dividend payers not only increase those payouts from year to year, but also offer stock-price appreciation on top of all that

Thus, they give your portfolio fairly reliable income (which you can live off of if you're older, or reinvest in more stock if you're younger) while boosting its value over time. And the very best of these companies keep their payout ratio relatively low -- below 70%, ideally -- ensuring that they're not devoting too much of their income entirely to paying their dividends.

Source: Motley Fool

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Summary only...

Dividend activity has picked up lately as companies begin to regain some sense of stability in the state of the economy, and visibility of future earnings growth. The iShares Dow Jones Select Dividend (DVY), an exchange-traded fund that tracks the Dow Jones U.S. Select Dividend Index, is up nearly 10 per cent so far in 2010.

There are several advantages to investing in dividend stocks for market watchers with long-term investment plans. Most simply, dividend stocks allow investors to make money with capital gains and with the dividend payments themselves, explained Dividend.com, a financial services website that notes “dividend stocks are not a get-rich-quick scheme” for day traders but are key to growing capital over longer periods of time, usually for several years.

Source: Globe and Mail

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Summary only...

With money market accounts yielding peanuts and bond returns so anemic only deflation will make them profitable, where else can conservative investors turn for low-risk investments? High yield dividend stocks are a great option — especially when they are stable blue chips offering quarterly paydays.

As we close out a rather volatile 2010 that has seen small gains in the broader stock market, investors who jumped into dividend stocks early this year are probably patting themselves on the back. That’s because even if share prices have been pretty flat, their stocks have paid off with regular dividends of 4% or 5% or even 6% payback on their initial investment.

Source: InvestorPlace

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Summary only...

Most of us are familiar with Einstein's famous quip that compound interest is one of the most powerful forces in the universe. In these days of low interest rates and extreme stock market volatility, this truism may be playing a role in the current infatuation with bonds and other long-term interest-bearing instruments. But Einstein had it wrong. What is true about interest can be even more true for stock dividends.

The threat of inflation highlights the advantages of dividends over fixed-rate interest. During inflationary times companies experience inflation-related earnings growth as currencies fall. This should cause their stocks to rise and allows them to increase nominal dividends. Fixed-rate bonds, by contrast, decline in value. In fact many blue-chip equities yield more than long-term Treasurys.

Source: Forbes

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Summary only...

It pays to know what other investors are doing. If like many investors, you're looking for stocks that combine the potential for rising share prices with the immediate gratification of receiving dividend payments, then knowing which dividend stocks have attracted the attention of the world's best professional investors is definitely worth the effort. Earlier this month, I was inspired by an article by Maz Jadallah, the founder of AlphaClone. Jadallah's service tracks hedge funds and other institutional investors. By poring through the holdings reports that many financial institutions are required to file with the SEC, AlphaClone gives you access to valuable knowledge -- and also lets you slice and dice it to focus in on a number of different investing themes.

Using AlphaClone, I searched through a database of nearly 300 institutions to find the stocks that appeared most often among the top holdings of each manager's portfolio. With the resulting 20 stocks, I filtered out every stock that wasn't paying at least a 3% dividend. Here are the five stocks from the final list, ranked by dividend yield: AT&T (T) 5.9%, Merck (MRK) 4.4%, Pfizer (PFE) 4.3%, Johnson & Johnson (JNJ) 3.4% and Chevron (CVX) 3.4%.

Source: Motley Fool

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Summary only...

Just about all stock investors want to minimize risk, but few agree on how to measure it. Some use the term "beta," instead of risk, as though naming something with a Greek letter adds credibility. Most finance web sites (including this one) publish betas that are based on past stock price volatility relative to a benchmark, but knowing that a stock's price was more or less sclerotic than the broad market over the past several years isn't necessarily evidence that the company is risky or safe.

Microsoft, Darden Restaurants and General Mills have exhibited stability of a different kind. Over the past 20 quarters, their earnings have been relatively steady. In math jargon, the standard deviation of their earnings during that stretch, when divided by the mean, results in a low coefficient of variation. Think of that as an earnings stability score where lower is better. The median for S&P 500 members is 0.53. Scores for the companies below are no higher than 0.35.

Source: SmartMoney

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Summary only...

DPS specializes in finding dividend paying stocks based on industry. There are 16 different industries covered. Each industry list has stocks that yield 3% or more. “We have found that most dividend investors are more interested in the industry of the dividend stock than the yield itself. That pushed us to create an in depth industry list.” – Alexander Ramsay – DPS.

CSN helps investors reduce their risk by identifying cheap stocks with strong financial ratios. Penny stocks with a high earnings and growth can be solid investments. Other factors to consider are the price to earnings ratio and cash on hand. CSN helps reduce the risk of penny stock picking by using these key data points. Both dividend paying stocks and cheap stocks now provide free investment research information to investors. CNS also provides a top 25 cheap stock list for free to those that sign up for their email updates. Please visit each website for more information.

Source: PRweb

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Summary only...

Building on the approach and principles of Benjamin Graham, Philip Fisher, Warren Buffet, John Templeton and Peter Lynch, Benoît Poliquin strives to own shares of ongoing and valuable businesses. Owning top tier companies in Canada and around the globe that have demonstrated a history, ability and willingness to increase their dividends is what Mr. Poliquin places the greatest emphasis on.

“We do not invest in the latest, or the next fad or technology, nor do we base our investment decisions on our (or someone else’s) ability to predict future market, macro or political landscapes,” he says. “After all, it’s not how much employment income you make that is important; it is how much income your investments can generate that will ensure your retirement.”

Source: Investing Thesis

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Summary only...

The highest dividend yields can be very tantalizing. As long as a stock yielding 15% doesn't lose value, you'll make 15% in one year! In more cases than not, however, an astronomical yield is a bad sign for a stock. Since dividend yields and stock prices move in opposite directions, a high yield usually means that investors have begun to worry about the business, and driven down its stock price.

Most real estate companies are organized as real estate investment trusts, or REITs. They do this so that they can get around the double taxation issue that most investors face. REITs don't pay taxes as long as they distribute at least 90% of their income as dividends. The investor holding shares of the REIT then has to pay taxes on those dividends as though they are income. This differs from most dividends which are taxed at a lower rate.

Source: Motley Fool

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Summary only...

Building a steady and safe income producing portfolio is paramount to retirees. High yield stocks, preferred stocks, convertibles and bonds are the basic building blocks for such portfolios. Research results indicate that blue chip stocks with high dividends, unlike highly volatile and low dividend or no dividend stocks (such as many high tech stocks and small company stocks), have produced comparable or even slightly higher returns with less risk in long term.

This plan is designed for income producing purpose: High dividend (yield) stock ETFs are chosen for both U.S. stocks and international stocks asset classes. We have decided to use general emerging market stocks ETFs (EEM or VWO) instead of some thinly traded high dividend emerging market stock ETFs. This situation will be changed once the high yield emerging market stock ETFs become more liquid and tradable.

Source: Seeking Alpha

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Summary only...

Exchange-traded funds have solved the predicament facing retirees who need investment income in a world of low interest rates. Several ETFs in the Claymore and iShares families now provide monthly payments of bond interest and dividends. Combine them in the right way and you get a diversified retirement income portfolio with a yield above 4 per cent. “Everybody wants yield, but in today’s market it’s hard to find,” said Pat Chiefalo, an ETF specialist at National Bank Financial.

Not just income, but monthly income. It’s much easier to manage your cash flow as a retiree if you’ve got investment income coming in each month, rather than every quarter or semi-annually. Many mutual funds pay income monthly, and now ETFs are starting to do the same. Blended together, the ETFs in the Monthly Yield Portfolio produce a flow of cash with a yield of about 4.4 per cent. This is achieved by judiciously mixing ETFs based on dividend stocks with bond ETFs. The overall mix is 33.7 per cent government and corporate bonds, 11.3 per cent preferred shares, 44 per cent dividend stocks and the rest in real estate investment trusts and high-yield bonds


Source: Globe and Mail

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Summary only...

Following two roller-coaster markets over the past decade, it's natural for investors to seek more stable and less stressful stock strategies. Dividend-paying stocks provide you with an opportunity to achieve both. Among other things, dividend-paying stocks:

• Are less volatile as a group than their non-dividend-paying counterparts.
• Provide you with a real return right away; with non-dividend-paying stocks, returns aren't realized until you sell.
• Allow you to choose what to do with the cash payouts -- reinvest in the stock, put them into savings, or buy groceries ... it's up to you.
• Offer you an inflation hedge when companies increase their payouts.

Source: The Money Times

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Summary only...

In spite of this week's 2% pullback, the S&P is up almost 15% since September 1st. So we went looking for foreign dividend paying stocks that haven't advanced as much as the general market, but still have strong metrics, low debt, and good growth prospects for next year.

We came up with China Mobile, (CHL), a dividend stock which is also the biggest mobile firm in the world. With over 522.283 million customers, China Mobile has the world's largest mobile customer base, and dominates the Chinese mobile market. It has a market share of approximately 70.6% in Mainland China. The Group's GSM global roaming services covered 237 countries and regions and its GPRS roaming services covered 182 countries and regions.

Source: Seeking Alpha

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Summary only...

When thinking of dividend stocks, we tend to think of large, boring companies like Wal-Mart or United Parcel Service. These stalwarts will most likely be around in 10 years, still paying you that quarterly dividend, but they will probably never be huge winners. For instance, in this decade, both Wal-Mart and UPS aren't among the top 10 or even the top 100 dividend stocks of the past decade, as measured by total return to shareholders.

If we want to find the best stocks for the next 10 years, it helps to know who performed best for the last 10 years. The decade's best dividend payers had to:

* Pay dividends every year from 2000 to 2010
* Have a market cap higher than $100 million
* Trade on a major U.S. exchange
* Not be an American depositary receipt


Source: Motley Fool

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Summary only...

Solid dividend stocks are not easy to find. Just about every investment show on television has guests on that recommend stocks that pay dividends. Viewers take their advice and go out looking for these high yield guarantee’s but end up being faced with a large number of unfamiliar choices. It leaves the average investor asking “which stock is right for me?”

Companies that increase their dividend each year are often increasing profits and or cash on hand. As the stock price rises, many companies will increase their dividend so that their yield does not decrease. If the yield did decrease the stock would suffer a large sell off. Increasing a dividend for 20 years gives investors the peace of mind that their yield is safe. But an increasing dividend is not enough of a reason to buy a stock

Source: PRweb

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Summary only...

Safe high yield stocks are in demand. With a uncertain investing climate, stock traders are looking for companies to invest in that pay strong and safe dividends. Dividend Stocks Online (DSO) takes aim at helping investor succeed.. “We believe that high growth high yield dividend stocks with a proven track record of paying dividends to shareholders are a solid investment in any market.” – Alexander Ramsay, DSO.

Companies that increase their dividend each year are often increasing profits and or cash on hand. As the stock price rises, many companies will increase their dividend so that their yield does not decrease. If the yield did decrease the stock would suffer a large sell off. Increasing a dividend for 20 years gives investors the peace of mind that their yield is safe.

Source: Benzinga

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Summary only...

The investment community has been making use of the DrIP Investing Resource Center's annual list of Dividend Champions for several years now. The list features companies that have increased dividends for more than 25 years -- and with their impressive records of payout performance, analysts have taken notice.

The problem? If analysts already have their collective eye on these top dividend stocks, there's a fair chance that most of the good news has already been priced in to them. A possible solution: Instead of snapping up the dividend champs they're mooning over, try having a look at the ones they may be underestimating ...

Source: Motley Fool
 
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Investors have been attracted to emerging market equities for many years now due to their capital appreciation potential.Until recently not many emerging market stocks have been known for their dividends.However that paradigm is changing. Companies in developing countries are increasingly paying out a higher portion of their profits to investors in the form of dividends.

Some of the reasons for investing in emerging market dividend stocks include:

• EM companies are changing their dividend policies to accommodate the demands of foreign investors who hold major stakes in these firms.
• Low corporate debt levels, improved governance and rising earnings allow companies to sustain dividend payments.
• Asian firms have raised their dividend payout ratios to attract foreign capital and the ratio now stands between 30% to 40%.
• Some companies are changing from growth-focused businesses to mature operations with the ability to pay dividends.
• Among emerging markets, countries such as Brazil, Taiwan, Turkey and China have the most developed dividend cultures while South Korea and others have lower dividend payout ratios.
• Brazilian companies are legally obligated to pay out over 20% of their net profits in dividends.
• The EM universe has a sufficient number of dividend paying stocks.
• The dividend growth rate of emerging stocks may outpace that of developed stocks.

Source: TopForeignStocks.com

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Although bonds have become popular the past two years, Paragon's wealth managers advise investors not to put their money into long-term bonds because Paragon believes investors could be hurt significantly if rates increase.

“Going forward, the returns that people will likely see in bonds will be very low at best or sharply negative at worst,” said White. “Unfortunately for bond investors, we believe it could be the negative scenario.” Paragon’s wealth managers advise investors to be aware of the maturities and quality of their bond holdings. The encourage investors to consider shortening the maturity of their bonds and adding high-quality dividend stocks as an alternative.

Source: PRweb.com

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In a rational world, stock prices would reflect company performance and future expectations, adjusted for risk. In this world, stock prices reflect human psychology, and are only indirectly related to actual company performance. Some people who are inexperienced with investing may view a rising stock price as direct evidence that the company is performing well. Similarly, they may conclude that if a stock price is falling, the company has performed poorly.

Investors a decade ago saw the bright futures of these five remarkable companies, and they paid a premium for shares of them. Unfortunately, they drastically overpaid, and therefore their returns were lackluster. Value investors, on the other hand, wisely understand that regardless of how well a company is performing, their stocks must be purchased at a reasonable price. People claim buy-and-hold is dead. It’s not dead. You simply have to do it correctly by buying great companies at reasonable prices.

Source: Dividend Monk

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In investing, the only way to be absolutely certain that something will happen is to wait until it actually happens. But when it comes to companies with long histories of paying higher dividends each year, counting on them to do everything in their power to keep their dividend hike streaks alive is the next best thing to a sure thing.

Every year, Standard & Poor's announces its list of Dividend Aristocrats. In order to qualify, a company has to increase its annual dividend payments to shareholders every year for at least 25 years. For 2010, just 43 stocks made the list. Being a Dividend Aristocrat carries a lot of prestige, especially lately as many investors have started to appreciate stocks that provide consistent income to their shareholders. Demonstrating an ability to maintain ever-increasing payouts over the course of several business cycles shows that a company has the financial strength not just to thrive in bull markets but to survive in tough business environments. Now more than ever, in the aftermath of 2008's financial crisis, investors want assurance that the stocks they own are stable and won't bring them any surprises.

Source: Motley Fool

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MLPs provide income seeking investors an unconventional, but potentially very attractive investment opportunity. Higher than normal yield and above average capital appreciation provide a total return potential that could be quite rewarding.

The double taxation normally associated with corporations is avoided because taxes are only paid when distributions are received. The actual rate of the quarterly required distribution is contractually derived between the unit holders and the general partners. However, each unit holders is responsible for paying their own share of the partnerships income taxes. This can lead to complications and complexity when the time comes to file and pay your taxes. Consequently, this particular asset class may not be suitable for everyone.

Source: Seeking Alpha

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Inglis-Jones is fairly upbeat about the outlook for equity income, highlighting analysis by Bernstein Research that shows dividend investing lags markedly in a sharp recovery, as has been seen over the past 18 months, before outperforming strongly in the post-recovery phase.

The duo’s approach is targeted at identifying companies with strong cashflows and is very much focused on putting their accounts under the microscope rather than relying on meetings with management. ‘The cashflow approach is compelling and I invest my own money this way,’ Inglis-Jones says. ‘Over time, yield investing as a strategy does very well. The process dictates what is in the portfolio, people are not that good at forecasting.’

Source: City Wire

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Many investors incorrectly assume it's fine just to chase stocks with the highest dividends. But reaching for yield, as it's called, can be dangerous. Companies don't have to maintain lofty dividends. If a stock price is sinking and the dividend payment gets high relative to the stock price, that could be a warning that the company may cut the dividend to conserve cash.

The danger of counting on just two stocks for dividend income is not to be taken lightly. You get the risk of the ups and downs not only of the broad stock market, but exposure to currency and political risk in Europe — both Novartis and Diageo are European. In addition, you are exposing your portfolio to the unique risks of the drugmaking and spirits businesses. By owning just two stocks, you'll need to watch these companies pretty closely to protect your principal.

Source: USA Today

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High-yield dividend stocks and income investing strategies have been in favor so far in 2010. That's largely because of great economic uncertainty, and the safety net that a guaranteed dividend payout provides. After all, if the market moves sideways but your portfolio has a dividend yield of 3% or 4%, you're still making decent profits while you tread water.

And if you want to be in dividend stocks, it goes without saying that you want to be in the best dividend stocks -- that is, picks that appreciate in share price and raise their payouts instead of slashing dividends or seeing stock prices slump

Source: TheStreet.com

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Here at MarketBeat we’ve been banging the drum on dividends for a while. And most recently, we spotlighted Don Yacktman’s explanation why investors looking for safety in the current environment should consider dividend stocks instead of bonds. (Short explanation: It’s the price increases, stupid.)

The Journal’s report last week that the Fed might be willing to start letting some strong banks start paying dividends seems to have help bring the conversation on shareholder payouts to more of a rolling boil. Of course, spotting who might raise dividends isn’t always the easiest. For its part, Goldman estimates that J.P. Morgan Chase, Wells Fargo and U.S. Bancorp may be the financials showing some of the biggest dividend growth in the S&P 500 over the next couple years.

Source: Wall Street Journal

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Every investor looks for dividends to juice yields and returns, as dividends are an important source of income for many, especially retirees. Here is a list of a few low-risk, high dividend stocks that investors can sleep soundly at night.

1. Altria (NYSE: MO) is a low-risk, large-cap stock that sports a hefty 6% dividend yield. Altria is the largest tobacco manufacturer in the country.
2. Merck (NYSE: MRK) is another low-risk defensive play, as the company recently finished its acquisition of Schering-Plough.
3. Johnson & Johnson (NYSE: JNJ), is the last low-risk, high dividend payer. The New Brunswick-based company is the maker of things like Band-Aids, Tylenol, and other products we use everyday.

Source: Benzinga

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The Fed’s money printing is the main reason the S&P 500 is up 81% from its March 2009 closing low. The rally occurred even though companies were net buyers of only $61 billion and investors pulled $52 billion out of U.S. equity mutual funds and U.S. equity exchange-traded funds. There is no way hedge funds, pension funds, and sovereign wealth funds had the buying power to push up the market cap of all U.S. stocks nearly $8 trillion in that period. That buying power had to have come indirectly from the Fed through its debt purchases…

So for average investors buying and holding stocks has an element of “playing chicken” to it. I don’t advocate market timing, but I am not a blind buy-and-holder either. Most of the smartest investors I talk to, that are actually long equities, recommend holding big global companies whose stocks pay healthy dividend yields. I think this is a sound strategy.

Source: Forbes

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The Federal Reserve is preparing guidelines for supervisors to use in assessing whether banks are strong enough to boost dividends or buy back shares, a person familiar with the matter said. The Fed plans to release the guidelines as soon as this month, said the person, who declined to be identified because the plan hasn’t been made public.

“It’s significant because it will give a level of guidance and understanding that the Federal Reserve did not use before,” said Thomas Sowanick, chief investment officer and co-president of Omnivest Group LLC in Princeton, New Jersey, which has $1 billion under advisory. “It really demonstrates the enhanced oversight that the Fed has.” “It signals that the Fed is comfortable with the capitalization the industry has or will have in the future,” said James Chessen, chief economist for the American Bankers Association in Washington. “It’s a very good sign.”

Source: Bloomberg

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In the investment community, the Standard and Poors 500 Index (S&P 500) is the most common benchmark representing the stock market as a whole. This is why S&P 500 Index funds are a favorite among passive ETF investors.Unfortunately, the S&P 500 as a whole has a low dividend yield (only around 2%). Therefore, if you are an income investor who is counting on a reliable stream of dividend payments, the S&P 500's low yield might not be a good core holding for you.

However, if you sift through the index's 500 component stocks, you will notice that a number of them are high-yielding, consistent dividend payers. Furthermore, for the more risk-averse, there also a number of blue chips in the index with solid dividend yields. Dividends matter. After all, a dividend check can help investors sleep easily because it shows that the company has a stable capacity to make money. Best of all, the cash in your hand is proof that the earnings are really there, and you can reinvest or spend them as you see fit.

Source: Investopedia

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While the bond market remains in the grip of a furious bull - yields, of course, are dropping precipitously. So for those folks who are looking for an established return on their investments, fixed income assets are no longer the place to be.

Thankfully, though, there are still a number of blue chip companies that pay dividends equal to or better than the ten year Treasury note. Below we list of these blue chips - companies with solid earnings histories and a long record of robust dividend payouts.

Source: Investopedia

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In 2008 and 2009, the dividend landscape was turned upside-down. During the fourth quarter of 2008 alone, 288 companies cut payouts. Not to be outdone, in 2009, according to Standard & Poor's, another 804 dividend payments were cut by public companies -- costing investors another $58 billion. Nevertheless, amid all the dividend cuts and suspensions of the past two years, we were reminded of five key lessons that we can use to our advantage going forward.

1: Dividends are a privilege, not a right
2: Beware of chasing high yields
3: Focus on cash, not earnings
4: Diversification still matters
5: Selectivity is paramount

Source: Motley Fool

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Many investors have firmly persuaded themselves that their best investment course is to buy bonds, regardless of their historically low yields. This is probably a symptom of excessive risk aversion, possibly driven by ego demands to avoid ever admitting to a loss. These emotions seemed to peak during the financial panic in 2007 when the Treasury was selling plain vanilla T-bills without inflation sweeteners at negative yields but the collective memory of that troubled period still makes investors shy away from better decent risks/reward ratios.

U.S. Treasury issues enjoy a premium as "risk-free" but even some corporate bonds are sought after while their corresponding stocks are passed up. Wal-Mart just sold $5 billion of bonds including $1.25 billion of five-year bonds that yield 1.5%. Its stock (WMT-$55) yields 2.2% and it has raised its dividend annually for 36 years. Granted, WMT stock hasn't done anything for the last 10 years but that flat line is due to an overvaluation of its earnings a decade ago. It is now trading at 13 times earnings and the return to stock investors will almost certainly exceed that to those buying its new bonds. (I think investors will do even better with faster growing Costco (COST-$63).

Source: Associated Content

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Years ago my father invested in what I call 'moose pasture stocks'-companies that go out in Northern Ontario and stake a claim in the pasture because of rumours that there's gold nearby-but there really isn't anything there. Their investments always seemed to be losing money, and I decided there must be a better way. So I made up an imaginary portfolio to practice with and I eventually discovered dividend stocks. Now I have a real portfolio that's worth $2.3 million.

If you're getting into dividend investing and you don't need the income right away, you should use a Dividend Re-Investing Plan, or DRIP, which automatically reinvests your dividends for you. Some companies actually sell you their stock at a lower price if you use one. A DRIP is especially good in an RRSP. I've been overjoyed with my results from dividend investing so far. In fact, we've done so well, we can't spend it all-so when we're gone, all of our money is going to be left to children's charities.

Source: MSN

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Yes, you read that headline correctly. On the heels of the worst two years for dividend investors in more than a generation, I'm telling you that now's the time to double down on dividend stocks. Allow me to explain.

While dividend payers have long been considered safe ports in stormy markets, this recession has been a notable exception. In the S&P 500, 62 companies cut their dividends in 2008, followed by another 90 in 2009. With glum news like this, dividend-paying stocks look like more of a gamble than ever. But while no dividend -- or stock -- is 100% guaranteed, this market is providing some great opportunities to buy strong, well-capitalized companies with high dividend yields -- at lower prices.

Source: Motley Fool

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Summary only...

Whether you're a beginning investor or a near-retiree, the importance of purchasing stocks that pay dividends cannot be overstated. Not only do companies that have quarterly or annual payouts provide you with a steady stream of income, they also have the potential for capital appreciation. Simply put, dividend stocks can give your portfolio what almost no other investment can -- both income and growth. Studies have shown that from 1972 to 2006, stocks in the S&P 500 that don't pay dividends have earned an average annual return of 4.1%; dividend stocks, however, have averaged a whopping 10.1% per year. That is an incredible difference -- one that you'd be crazy to not take advantage of!

But investing in dividends can be dangerous -- companies can cut, slash, or suspend dividends at any time, often without notice. Fortunately, there are several warnings signs that may alert you, and these red flags could be the crucial factor in determining whether or not a company is likely to continue paying its dividend. The bottom line, however, is to make sure that with anything -- whether it be a dividend, a share repurchase, or an ordinary earnings report -- you do your own due diligence. Looking at all of the numbers in the best context possible is just the best place to start.

Source: Motley Fool

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