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. Let's check out the results so far.
|Southern (NYS: SO)||$39.71||25.0818||$44.06||$1,105.10||11%|
|Exelon (NYS: EXC)||$41.82||23.818||$44.05||$1,049.18||5.3%|
|National Grid (NYS: NGG)||$48.90||20.3693||$49.26||$1,003.39||0.7%|
|Philip Morris International (NYS: PM)||$68.49||14.5429||$75.69||$1,100.75||10.5%|
|Annaly Capital (NYS: NLY)||$18.24||55||$16.16||$888.80||(11.4%)|
|Frontier Communications (NYS: FTR)||$7.88||126.4243||$5.64||$713.03||(28.4%)|
|Plum Creek Timber||$38.42||26||$36.52||$949.52||(4.9%)|
|Brookfield Infrastructure Partners (NYS: BIP)||$26.12||38.2825||$25.66||$982.33||(1.8%)|
|Investment in SPY|
Source: S&P Capital IQ.
Our total portfolio performance moved from -5% last week to -1.9% this week, a good weekly improvement by any measure. But wow, what a week for the S&P, which moved from -9% on our scorecard to -2.4%. That narrowed our outperformance from 4.0 percentage points last week to a modest 0.5 points now. But I'm confident in the long-run nature of this portfolio, and I fully expect to outperform. We have six stocks outperforming the index. And even if our capital goes down in the interim, we'll still see dividends while we wait.
As I mentioned last week, because of the Fool's trading restrictions, I have yet to add to my Annaly position. And I've decided to up my reinvestment in Annaly to $170. While not all the news has been good from the mortgage REIT sector, Annaly still looks poised to pump out solid dividends.
Dividends and other announcements
Going into the holiday season, the news has been pretty light. We have these bits of dividend news:
- Plum Creek went ex-div on Nov. 10 and paid $0.42 per share on Nov. 30.
- Vodafone announced a special dividend of 4 pence on top of its 3.05 pence interim payout. The stock traded ex-div on Nov. 16, and the money will be paid out on Feb. 3. In dollars, the total payout comes to about $1.12 per U.S. share at current exchange rates.
- Southern went ex-div on Nov. 7 and distributes $0.4725 per share on Dec. 6.
- Exelon went ex-div on Nov. 15 and pays out $0.525 per share on Dec. 9.
- Frontier goes ex-div on Dec. 7 and pays out $0.1875 cents per share on Dec. 29.
All that, of course, means more money coming into our pockets shortly.
It's fun to sit back and get paid, and with the market volatility, we might have a good chance to reinvest those dividends at good prices. Europe continues to be an absolute mess, and continued bad news will probably have stocks plunging again. If they do, I'll be inclined to pick more shares up.
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 the year, including news on these companies.
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At the time this article was published Jim Royal, Ph.D., owns shares of the 10 portfolio stocks mentioned in the table. The Motley Fool owns shares of Seaspan, Brookfield Infrastructure, Annaly, Plum Creek, and Philip Morris and has created a covered strangle position on Plum Creek.Motley Fool newsletter serviceshave recommended buying shares of Exelon, National Grid, Philip Morris, Vodafone, Southern, and Brookfield Infrastructure, as well as writing a covered straddle position in Seaspan and a covered strangle position in Exelon. 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.