The World's Best Dividend Portfolio
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.
|Southern (NYS: SO)||$39.71||25.0818||$40.26||$1,009.79||1.4%|
|Exelon (NYS: EXC)||$41.82||23.818||$42.12||$1,003.21||0.7%|
|National Grid (NYS: NGG)||$48.90||20.3693||$49.14||$1,000.89||0.5%|
|Philip Morris International (NYS: PM)||$68.49||14.5429||$69.67||$1,013.20||1.7%|
|Annaly Capital (NYS: NLY)||$18.24||55||$17.99||$989.45||(1.4%)|
|Frontier Communications (NYS: FTR)||$7.88||126.4243||$6.99||$883.71||(11.3%)|
|Plum Creek Timber (NYS: PCL)||$38.42||26||$35.17||$914.42||(8.5%)|
|Brookfield Infrastructure Partners (NYS: BIP)||$26.12||38.2825||$26.04||$996.88||(0.3%)|
|Vodafone (NAS: VOD)||$26.52||37.5566||$26.54||$996.75||0.1%|
|Seaspan (NYS: SSW)||$14.61||69||$12.36||$852.84||(15.4%)|
|Investment in S&P 500 ETF||(11.5%)|
|Relative Performance (percentage points)||+9.2|
Source: Capital IQ, a division of Standard & Poor's.
The portfolio is now outperforming the S&P 500 by 9.2% in its first few weeks. Even better, it's improved its total performance from last week, during one of the most brutal weeks this year. Still, I'd prefer to see absolute and positive outperformance. I'm not particularly concerned about short-term fluctuations, though. This dividend portfolio is designed to do better when the market is performing poorly. In the meantime, we'll cash our dividend checks and wait for an opportunity to reinvest those proceeds. Both Seaspan and Frontier have taken the market downturn hard and could be attractive places to add reinvested dividends.
Dividends and earnings announcements
We're moving out of earnings season and into dividend season, and we have a few bits of news:
- Southern went ex-dividend on July 28 and pays out its dividend of $0.4725 per share on Sept. 5.
- Exelon went ex-dividend on Aug. 11 and will pay $0.525 per share on Sept. 8.
- Plum Creek went ex-dividend on Aug. 12 and pays out a dividend of $0.42 per share on Aug. 30.
- Seaspan went ex-dividend on Aug. 11 and pays out $0.1875 per share on Aug. 21.
- Brookfield Infrastructure goes ex-dividend on Aug. 29, with a payday on Sept. 29.
We'll be watching out for dividends and other news items in the next weeks, but we're at the end of earnings season, at least for this portfolio. Several stocks are set to go ex-dividend shortly. With the market volatility, we might have a good chance to reinvest those dividends at good prices.
Naturally I'd prefer to have more cash in the portfolio so I can take advantage of lower prices, but I won't be surprised to see stocks move lower in the coming weeks, as fears about Europe continue to erupt. Still, I'll be on the lookout for cheap dividend stocks.
Foolish bottom line
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. As I promised in the original article, I'll be holding these stocks for at least a year and will continue to track the portfolio over the course of that year, including news on these companies.
If you like dividends, consider the 10 tickers in my portfolio along with the 13 names from a free report from The Motley Fool's expert analysts called 13 High-Yielding Stocks to Buy Today. Hundreds of thousands have requested access to this report, and today I invite you to download it at no cost to you. Get instant access to the names of these 13 high yielders -- it's free.
At the time this article was published Jim Royal, Ph.D., owns shares of every company mentioned here. The Motley Fool owns shares of Brookfield Infrastructure, Philip Morris, Annaly, and Seaspan. The Fool owns shares of and has written puts on Plum Creek.Motley Fool newsletter serviceshave recommended buying shares of Brookfield Infrastructure, Southern, Exelon, Vodafone, Philip Morris, and National Grid, as well as creating a covered strangle position in Exelon and writing a covered straddle position in Seaspan. Try any of our Foolish newsletter servicesfree for 30 days. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.
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