Dividends4Life: The Best Dividend Portfolio

The Best Dividend Portfolio

Posted by D4L | Tuesday, September 27, 2011 | | 0 comments »

In June, I invested my money equally in a selection of 10 high-yield dividend stocks. Those names offer triple the yield of the average S&P 500 stock. You can read all the details. Now let’s check out the results so far. The portfolio has now broken into positive territory, against the S&P's decline of 6.1% over the same time period, for outperformance of 6.2 percentage points. Eight of our 10 picks are beating the S&P. Despite the gains for the week, we actually lost ground on the S&P, which we were beating by 7.1 percentage points last week. But that performance is also a reminder of the stability of dividend payers over time -- good downside protection and continued income but also less upside volatility.

I'm not particularly concerned about short-term fluctuations, though. In the meantime, we'll cash our dividend checks and wait for an opportunity to reinvest those proceeds. In particular, Frontier is bringing the average return down, meaning the stock could be an attractive place to add reinvested dividends. I've been a fan of big dividends for a while, and I think this portfolio will outperform the market over time through the power of dividends.

Source: Motley Fool

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