Investing Options for Income Investors
Investors looking for income often fall into the trap of buying the highest-yielding equities they can find. They will often ignore the underlying fundamentals of the holdings and watch their principal erode as the dividend payments come in.
In general, when evaluating dividend securities, it is important to focus on companies that not only pay and grow their dividends, but also have positive free cash flow sufficient to cover the dividend payment. In addition, at Navellier we’ve found that some of the most profitable dividend stocks are those that demonstrate compelling profitability measures. What this means is that these stocks should exhibit positive return on equity and positive return on assets.
At Navellier, our dividend and income portfolios strive for portfolio growth through securities with capital appreciation, strong dividend growth and income opportunities.
Power Dividend Portfolio: This portfolio invests in U.S. listed securities with market capitalizations greater than $250 million that pay dividends. The strategy may hold American Depositary Receipts (ADRs). Typically, the strategy invests in approximately 15 to 25 stocks.
Our suite of income portfolios:
- Are managed by Navellier Portfolio Managers.
- Implement a rigorous testing process.
- Are adjusted to adapt to changing market trends.
To find out if any of these portfolios could work for you, simply call us at (800) 887-8671 or fill out our Portfolio Review Request for a personal portfolio review and confidential assessment to get started today.
Concentrated High Dividend Portfolio: This portfolio is highly concentrated and focuses on identifying dividend-paying securities with the potential for stable consistent income. The strategy invests in U.S. listed securities with market capitalizations greater than $1 billion. The universe is screened based on free cash flow. Stocks are then ranked by yield and dividend growth rate. The most attractive stocks based on yield are fundamentally ranked using Navellier’s proprietary fundamental ranking system. At any given time, the strategy may hold up to 30% in American Depositary Receipts (ADRs). Typically, the strategy invests in approximately 10 to 20 stocks.
Covered Call Portfolio: The strategy with this portfolio is to buy stocks and simultaneously write call options against them. This allows the portfolio to generate income (via the premiums earned on the calls and the dividends). The strategy’s goal is to achieve premium income while forfeiting the least amount of stock appreciation. To generate greater growth potential, the strategy will generally write covered calls on only a portion of the equity positions in the portfolio and will generally focus on higher dividend paying companies.
Our dividend and income portfolios are best used along with other styles and asset classes.
A Look at Our Custom Portfolios
At Navellier, we recognize that you are a unique investor with goals, risk tolerances and other factors that need to be considered for a complete investment strategy. This is why we look at the whole picture and make custom recommendations that suit your needs.
For example, if you are interested in having an income strategy, but also want to capitalize on Large Cap Growth stocks and include some Defensive holdings, here is a very simple sample of how we could blend three of our portfolios to achieve your goals within your preferred risk tolerance.
For more information on our Private Client Group, and how we may be able to put together a custom asset allocation strategy designed to fit your specific investment goals, please call us at (800) 887-8671 or fill out our Portfolio Review Request for a personal portfolio review and confidential assessment.
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Performance results presented herein do not necessarily indicate future performance; investment in equity strategies involves substantial risk and has the potential for partial or complete loss of funds invested. Results presented include reinvestment of dividends and other earnings. None of the stock information, data and company information presented herein constitutes a recommendation by Navellier or a solicitation of any offer to buy or sell any securities.