You are receiving this email because you signed up to receive emails from True Market Insiders, rebranding to Sector Edge. Unsubscribe here Keep the emails you value from falling into your spam folder. Whitelist True Market Insiders. Forgot your login information? Click here. ![]() Weekly Market Update Today is Feb. 26, 2022
Hey TMI Subscriber, Let's talk about dividend-paying stocks.
Why?
They allow you to profit in two ways: first, through the appreciation of the price of the shares, and second, through distributions made by the company.
It's not a bad idea to own them whether or not you're focused solely on retirement.
Many dividend-paying companies are quite large and successful. They distribute cash back to investors because they have a lot of money, and they feel pressure from shareholders to split those profits.
Certainly, past performance is no guarantee of future success, but it can be helpful to look backward when gauging these investment opportunities.
One thing TMI has already addressed this year is the major reversal of sector leadership. Energy-,and Financial-related sectors are atop our Relative Strength Matrix on the Sector Prophets Pro data platform.
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Interestingly, over the past 10 years, no sector has been worse than the S&P 500 Energy sector. It has gained just 2.4% annualized over the decade, the only sector without a double-digit return.
Notably, all of that return has come from dividends. On a pure price-return basis, the sector is actually negative.
Today, the flip has switched with Energy as one of the best performers, up 31% in 2022, as the price of oil continues to toy with the milestone of $100 per barrel.
Some key dividend stocks in the Energy sector include Exxon Mobil (XOM), with a dividend yield of 4.49%, Chevron (CVX), with a dividend yield of 4.12%, and BP (BP) with a dividend yield of 4.01%.
If you want dividend yielders in your portfolio, it's important that you look for companies that have shown a commitment to raising dividends over the long run and have strong underlying earnings growth.
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So-called "dividend growers" have historically generated higher returns than other dividend strategies while also keeping up with the broader market.
A company with strong earnings and dividend growth also provides some protection against interest rate hikes.
Finally, keep an eye on the utility sector. Utilities have historically been one of the highest-yielding and lowest-volatility sectors of the market, providing an important portfolio tool for risk averse, income-oriented investors.
Utility companies such as Duke Energy (DUK), Consolidated Edison (ED), and Exelon (EXC) have had decent returns over the years as well as paid nice dividends. Duke has a dividend yield of 3.75%, Consolidated Edison 3.71%, and Exelon is paying 2.72%.
Just like with any portfolio position, though, be sure to know your risk tolerance and stick to it. Now, here's a review of the latest TMI articles. This Week in True Market Insider Feb. 21 - Feb. 25, 2022 Get Ready for a Huge Buying Opportunity— Chris Rowe
Chris Rowe says that all the technical indicators suggest the market will go lower. However, he's really looking forward to all the buying opportunities it will present. Powerful Forces are Working Against Your Portfolio — Tim Fortier
Economic forces continue to work against investors' portfolios as weakness becomes more broad. Tim Fortier says you need to have a good defensive strategy and the ability to profit from declines. Dispersion is a Sector Investor's Best Friend — Costas Bocelli
Costas Bocelli wants you to know that the bigger the gap in performance or "dispersion," between the best-performing sectors and the worst-performing sectors, the bigger your potential profits. Invasion? What Invasion? Technical Indicators Don't Care — Karen Riccio
Seeing military tanks rolling into Ukraine can be emotional. But don't let emotions spill over into your investment decisions. Karen Riccio highlights three sectors thriving in today's complex climate. Watch This Presentation to Learn a Better Strategy for More Winning Trades
If you're not familiar with our Profit Skimmer trading service, now is definitely a good time to learn.
That's because with all this market volatility you may be looking at bonds or dividend stocks as hedges.
It's not your fault. That strategy has worked for many years.
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2022年2月26日星期六
Dividend Energy Stocks Offer Best of Both Worlds
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