If you are a long-term income-focused investor, Wells Fargo continues to pay a big attractive dividend (3.4%). And the contrarian in you may even be considering buying more shares after it took another beating from Congress yesterday for its fake-account-opening scandal. But what you may not have considered is the sharp jump in premium for writing covered calls, and how this is a relatively low-risk options strategy for long-term investors to increase income.
Annaly may have the financial wherewithal to maintain its big dividend (11%) for more than the next few quarters, but its asset value and share price are in peril, and so is the company’s long-term dividend sustainability. The recent Hatteras acquisition is an ominous reminder of the atrocious yield curve and Annaly’s shrinking balance sheet. The upcoming REIT sector creation and approaching Fed interest rate hike may put a damper on this year’s dividend-stock hype.
Artificially low interest rates have pushed many investors out of traditional fixed income categories and into high-dividend low-volatility stocks such as AT&T. But as many of these stocks start to look expensive, some investors are now reaching into covered call strategies to eke out some extra income. In this article, we highlight five big income options that we like more than AT&T covered calls.
The Fed’s recent “systematically important” stress test results highlight the growing opportunities among big banks for risk averse income-seeking investors. If you are frustrated with artificially low interest rates, and discouraged by richly valued REITS and utilities, it may be time to give the big banks a closer look.
Donald Trump again bragged on Twitter recently about his financial disclosures, so we decided to take a closer look at the stocks he owns. He has a very diversified portfolio of mostly blue chip stocks that pay dividends. And we believe some of them, in particular, are very attractive. Without further ado, here is the list of ten Donald Trump stocks worth considering.
When it comes to big dividend preferred stocks, there’s the good, the bad and the ugly. Before getting into all the details of the five big dividend preferred stocks we really like right now (the good), we first give an example of a big dividend preferred stock that we consider “bad” and one that we consider truly “ugly.”
We like Wells Fargo. It has a big 3.2% dividend yield, a diversified business model, and the potential for significant price appreciation. We believe recent market events (e.g. exaggerated news stories about interest rates, energy sector exposures, analyst ratings, and new regulations) have caused the stock to sell off more than it should have and created an attractive buying opportunity for long-term investors.