Got some investing money you’d like to double? As in, grow it by 100% or more? Here’s the surest and safest way to do it quickly.
Well, before we get into getting rich, let’s talk about income. Not everyone needs to grow their pile of money bigger and bigger. Some of us are done accumulating and are looking for cash flow to help us cruise through retirement.
So, we have two options:
Option 1: Invest for Income Today
Put some of the cash pile into safe funds and stocks. I can show you where to find 7.2% yields, which means you can build a “no withdrawal” portfolio that spins off, say, $72,000 on a million bucks (again, thanks to the 7.2% dividends).
Of course, today mainstream bonds pay 1%-something and few blue-chip stocks pay over 2%. So popular payouts won’t get it done. Fortunately, you’re talking to one of the guys who wrote the book on retiring on dividends! Our Contrarian Income Report portfolio pays 7.2% today–it’s doable to find these types of yields if you know where to look.
Option 2: Double Your Money Every Few Years (Also with Dividends)
Our strategy here is similar to our first one, except we are prioritizing tomorrow’s dividends over today’s. So, it is the trajectory of our payouts that is most important.
Why? Because stock prices tend to rise as fast as their dividends.
For example, PepsiCo (PEP), has made its investors rich thanks to its ability to grow its dividend. Check out the orange staircase below–that’s the payout that PepsiCo hikes every year. Its stock price (blue line below) is attracted to the payout curve like a magnet. Here’s their relationship ever since the beverage maker began paying a dividend:
Every Pepsi Payout Refreshes the World
And we can see that over the last five years, its 46% payout growth has perfectly predicted its 46% price gains:
For the Love of It(s Dividend)
PepsiCo’s payout growth has slowed in recent years as it’s filled the market for sugar water. Sub-10% annual dividend growth is unacceptable for true dividend growth investors like us!
PepsiCo’s best years of payout growth are behind it. Same goes for many other Dividend Aristocrats, the stocks that have hiked their dividends for 25 or more consecutive years. They are treated like royalty, so their valuations are always high and their current yields are rather low. But it doesn’t make sense to reward past accomplishments since the stock market is a forward–looking vehicle.
Which is why my Hidden Yields advisory focuses on stocks that are raising their payouts well more than average. I’m talking about 18% dividend increases year-over-year!
The result? Our HY portfolio is up 29.7% year-to-date. At this rate, our money is going to double in just over two years! And sure, the market is up and that’s helped. But we’ll gladly “settle” for the 17.4% per year our portfolio has delivered since inception, too!
But, What About a Recession?
Our timely buys are a key ingredient in our secret sauce. And constant recession worries help us out.
Let’s rewind to December, when every contrarian indicator was telling us that stocks were ready to rally. While individual investors worried that a 20% decline would snowball into a 40% crash, we saw sentiment at extreme lows and smartly bought not one but two dividend growers on December 21.
The timing was right, as were our picks. Just three days later, the stock market bottomed and began an epic rally that took the S&P 24% higher. That was cute, but Mr. Market had nothing on our two purchases, which sprung an average of 51% in just seven months!
How to Make 51% in 7 Months
Now December-type opportunities don’t happen often. Most of the time, the market meanders between extremes and stocks are neither obvious buys nor sells. You could just as well flip a coin to figure out where shares are likely to head in the short-term.
But, it’s a weighted coin.
Stocks are better than heads or tails. They go up two-thirds of the time. This is why it’s important to be fully invested at all times.
The always-bearish “gurus” you read elsewhere on the Internet? Their returns are pitiful. They may avoid crashes, but they don’t know when to get back in. So they lag us, and they’ll never catch up.
That’s not an exaggeration. Let’s use the last four years as an example. Since we launched HY in the summer of 2015, I’ve been hearing from subscribers worried about a repeat of 2008. And hey, I get it–we’re all 11 years older now and we can’t afford a rerun.
But we can’t afford to be out of the market, either. Here’s why. Any portfolio that’s been half in-cash since we launched Hidden Yields needed 35% returns from its stock-portion to merely keep up with us. Not possible (again, if possible, the person would own the NYSE!)
Another reason to stay invested? Fall 2019 could be just like the autumn of 1995. That was the last time the Fed cut interest rates while the stock market was surging.
My pal and finance quant Troy Bombardia considered this and every previous case in which the Fed tossed the markets an “easy money cut.” The S&P 500 averaged 15.5% returns over the next twelve months.
Rewind to July 1995: The Last “Easy Money” Cut
“Brett, What’s the Best Way to Increase Wealth Long-Term?”
Several subscribers have written in recently asking which dividend strategy is the best one to increase their wealth over the long haul. That’s easy. It’s Hidden Yields and its 17%+ yearly returns.
At this rate, we’re doubling our money about every four years. We’re doing it simply by buying the stocks that are increasing their dividends the fastest. And we’re buying without worrying about the bear market boogeyman that unravels most investors.
Remember, for us, bear markets are buying opportunities. December sure was! Our secret was that we didn’t panic. We held onto our elite dividend growers and used the opportunity to buy more.
To quote the late, great Eddie Money, many investors “wanna go back” and buy those December bargains. Of course they can’t, but you can do the next best thing and buy my seven favorite dividend growers right now.
Don’t regret not buying these seven when we revisit these picks months from now! All are poised for fast 50% gains like the two examples we smartly bought in December.
7 Dividend Stocks Ready to Return a Fast 50%
I use computers, screens, tools and my own head to uncover dividend moonshots that will easily pay you 17% per year. That’s enough to double your money in just over 4 years.
Imagine, turning a retirement ‘pot’ of $250,000 into $500,000… or… $500,000 into $1,000,000… and on it goes.
Please click here to learn the names of my seven favorite dividend stocks with 100%+ upside. I’ll share their names, tickers and my full research with you including my recommended buy-up-to prices.