One of the primary problems both institutional and private investors face every day is the ongoing low interest rate environment that makes gaining any reasonable amount of portfolio income seem nearly impossible. Cash in money market funds and bank deposits earn around zero, resulting in negative yields as they lose significant value to inflation, which has been on the rise recently. Financial media commentators use words such as “yield starvation” and “ravenously hungry” to describe the attitudes of income investors over the last couple of years. Many investors have purchased low grade junk investments to try to gain income, and often lose money in the process.
Properly researched and allocated dividend investments in a quality portfolio construct can produce a respectable yield and growth opportunity if you just know where to look. And where is all this income yield hiding? In plain sight of course.
DISCLAIMER: The asset names and other content mentioned in this article are not investment recommendations and are for informational purposes only. These investments can lose value and may cease income payments at any time. Kensington A.M.I. LLC and Benjamin Lupu CFP assume no liability when providing this information. Investors are urged to conduct further research and consult with Benjamin Lupu CFP before investing in any of the securities mentioned in this article.
Dr. Dividends Top Income Power Picks for 2022:
(Dividend Yields are as of Dec 29, 2021):
1-ABBV AbbVie Pharmaceuticals. Major drug maker and research company. It owns the patent to Humira, an anti-inflammatory drug that is among the largest selling prescription products worldwide. Earnings are growing and it is well managed. Dividend Yield 4.2%.
2-GILD Gilead Sciences: This underappreciated company has cured Hepatitis C and also provided Remdesivir, the only Covid-19 therapeutic currently used in hospitals. This company has growing earnings and a very good balance sheet. New products are in its pipeline. Dividend yield: 3.9%
3-MRK Merck: Among the most important health care companies in the world. Its Keytruda cancer drug has saved thousands of lives (including one of my closest friends). Earnings are growing fast. Dividend yield: 3.60%
4-QYLD Global X Nasdaq Covered Call Nasdaq 100 ETF: This is an exchange traded fund that holds the top 100 Nasdaq stocks and sells option contracts against stock positions to gain income. Income may vary and this ETF trades with the Nasdaq 100. This ETF offers little, or no upside gain potential due to option strategy, but yields a very impressive 11.80%
5-IBM: This old stalwart has been left behind by the recent new wave technology boom, but IBM makes an impressive amount of consistent earnings and is a primary player in artificial intelligence development. It has bounced off of its recent lows and may gain in value over time. Dividend yield 4.93%
6-PRU Prudential: A primary insurance carrier, this company owns a big slice of the insurance and annuity business . A multi-line carrier, this company has many channels of cash flow. Dividend yield: 4.22%
7-BST: Blackrock Science and Technology Trust. This is a closed end mutual fund and contains many of the top technology leaders such as Microsoft, Google-Alphabet, Apple and Amazon. The trust has gained in value sharply and is a bit expensive due to outstanding performance of its holdings, yet it still yields an impressive 6.10%
8-BME Blackrock Health Sciences Trust: Structured in the same way as the BST, (closed end mutual fund) this is a healthcare and biotechnology fund. This ETF holds some fo the best healthcare companies in the world and is inexpensive compared to BST. It may be undervalued compared to the rest of the S&P 500. Dividend yield 5.30%
9: VZ Verizon: This primary telecom provider has lagged the overall market for some time, though it is a leader in 5G development. Dividend yield 4.86%
Before investing in any of these shares, please consult with us so we can properly complete due diligence before allocating positions.