| Although I am generally not an advocate of | | | | has been, how consistent their dividend, or how |
| market timing (my crystal ball has been on the | | | | exceptional their management, events over the |
| blink lately), there is one circumstance when the | | | | past few years show that almost any company |
| timing seems to be right for high yield investors. | | | | can take a fall. Look at Enron, AIG, Lehman |
| That time is when external factors impact the | | | | Brothers, and the myriad of banks and financial |
| market in such a way that numerous dividend | | | | companies, previously considered "orphans and |
| paying stocks, with strong and consistent | | | | widows stocks," that dropped almost overnight |
| fundamentals, drop in price so that their dividends | | | | during the financial crisis precipitated by the |
| begin to show extraordinary yields. Today there | | | | subprime mortgage fiasco. No matter how good |
| are a multitude of negative factors impacting the | | | | an individual stock looks, it almost always pays in |
| financial markets: problems in Greece causing the | | | | the long run to be diversified. |
| markets to be concerned about all of Europe's | | | | Speaking of diversification, most of the time |
| financial stability, continuing scandals and crises on | | | | investment advisors suggest investing in a wide |
| Wall Street, with Goldman Sachs under SEC and | | | | range of equities with a mix of income, growth, |
| congressional scrutiny being the latest, and finally | | | | value, international, domestic, large cap, small cap, |
| the concerns about our increasing national debt, | | | | etc, with various different categories represented |
| have caused our markets, which rose briskly | | | | such as energy, finance, telecom, pharmaceuticals, |
| from March 2009 to March 2010, to suddenly | | | | utilities, etc. Since investment advisors are most |
| take a rapid downturn punctuated by the | | | | often in the equities business in some form or |
| unexplained May 6th 1000 point spike down in the | | | | other they often forget that there are other |
| Dow in a 30 minute period. This perfect storm of | | | | forms of diversification that may not be suitable |
| events has caused many very sound companies | | | | for everyone, but can make a lot of sense for |
| to drop in price creating an opportunity to find | | | | certain investors looking for high yield. At the |
| unusually high yields among some of the best blue | | | | present time, due to the decline in real estate |
| chip stocks. There are plenty of places on line to | | | | prices, there is a great opportunity to directly |
| go and find lists of dividend paying stocks. Suffice | | | | purchase and manage small investment |
| it to say that, as I write this article, opportunities | | | | properties, duplexes, triplexes, single family |
| abound to lock in high yields in oil & gas master | | | | homes, etc. This may not be for everyone, but |
| limited partnerships, real estate investment trusts, | | | | for those who are willing to take on the duties of |
| business development corporations, and many | | | | landlord, the returns can be rather handsome. Like |
| blue chip companies in telecommunications, | | | | the current situation with dividend paying stocks |
| pharmaceuticals, healthcare and consumer staples. | | | | where the price is depressed raising the yield, the |
| Creating a diversified portfolio of high yield income | | | | same thing is currently true regarding investment |
| producing stocks is not difficult. It is important, | | | | properties. Like purchasing equities, it is important |
| however to determine your own individual | | | | to do your homework and determine if the |
| investment criteria and tolerance for risk, so that | | | | investment property is right for you. How far is it |
| you purchase equities that are appropriate for | | | | from where you live? What are your true costs? |
| you. For example, if you are looking for dividend | | | | How much of the maintenance and management |
| paying stocks that have consistently raised | | | | can you do yourself? |
| dividends, simply type into any search engine, | | | | Another form of diversification is having a second |
| "consistent dividend increasing stocks," and you will | | | | job. This doesn't have to be overwhelming, but a |
| find a world of information to begin your search | | | | few thousand dollars a year coming in from |
| for stocks suitable for you. If you are looking for | | | | consulting, or even baby sitting, will add up over |
| equities yielding over 5%, over 7%, over 10% or | | | | time if the proceeds are invested in your portfolio. |
| even higher, put your criteria into any search | | | | Having multiple and diversified sources of income |
| engine and again you will have plenty of | | | | has always been a good idea, but in today's world |
| information to begin your due diligence. | | | | of uncertainty, it makes even more sense. |
| While it may be tempting to invest a high | | | | Today, dividend yields are higher than normal, real |
| percentage of your available funds into one or | | | | estate prices are lower than they have been in |
| two equities that seem to fit your criteria | | | | years, and there are always opportunities for |
| perfectly, it can be quite risky to do so. No | | | | those who are willing to work hard to find them. |
| matter how perfect a company's track record | | | | |