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A Unique Income Strategy That Works in Any MarketBy
Wednesday, June 12, 2013
Just like we predicted, November was an incredible time to buy stocks...
Since bottoming in mid-November, the stock market has gained an amazing 24%. Many well-known stocks are up even more. Bank of America, for example, is up 54%. General Motors is up 45%. And American Express is up 42%.
In other words, stocks have packed two to three years' worth of gains into six months. The market is like a runner. It can't sprint flat out for miles without taking a "breather." That's why you're probably hearing lots of analysts say we're due for a big correction. They may be right...
But if you're in an elite group of investors, you couldn't care less if a correction comes. You couldn't care less if the market drops 8%-10% (which it could easily do). Heck, you couldn't care less if the market shut down for a year.
A few years back, I told you about this "worry free" group. They're folks who have learned how to buy the world's best companies at cheap prices... and hold them for years. My colleague Dan Ferris calls these companies "World Dominators"...
World Dominators are the world's biggest and best businesses. They are No. 1 in their industries. They are names you see every day... like Johnson & Johnson and Coca-Cola. They typically pay the world's safest dividends. Over the long term, these stocks can compound even small investments into a retirement fortune.
The thing is, most investors are interested in short-term gratification. They watch CNBC clips, constantly check stock quotes, and do other things that waste a lot of time and energy. They're always busy trying to get the market to do something for them... instead of using the greatest power in all of investing.
That power is TIME. And used properly, time causes extraordinary things to happen to your portfolio. Time allows you to generate huge amounts of income... and time makes it so you don't care one bit about the moods of the stock market.
Here's how it works...
An investor who bought semiconductor giant Intel (NASDAQ: INTC) back in 2009 paid as little as $12 a share. At the time, it was yielding 4.7%. Intel is a cash-gushing World Dominator. And it's grown its dividend so much that this investor is now earning a safe 7.5% dividend on his purchase price. (The share price has doubled, too.)
If you're that investor, do you care if the stock price declines 10% or 20%? Do you care about a market correction? No way.
Gold is down 20%? Interest rates are rising or falling? The Facebook IPO is a disaster? You just don't care about any of this "noise." You only care that your quarterly dividends are being paid.
Most folks won't take this example to heart. The obsession with short-term gratification causes people to "miss the boat" on the incredible income power of World Dominators. You see, these companies don't pay out huge current yields. They pay current yields of around 3%-4%... and then "grow" their way to pay shareholders 10% and 20% yields.
These yields end up as the safest, largest income streams you'll find anywhere.
But most folks don't have the patience for this safe strategy. They'll continue chasing low-quality stocks. They'll continue having sleepless nights. They'll continue wasting time.
If you're ready to stop wasting time... and use it to your advantage instead... start looking to buy World Dominators when you get the chance.
Good investing,
Brian Hunt
Further Reading:
Learn more about how to put time – and the power of compound returns – to work for you in this two-part series from Dr. David Eifrig:
The Easiest Way to Make $1 Million in the Stock Market
"I know this works, because both my sister and father used it to grow wealthy." Retire Early with This Safe Stock System
"This secret is not 'sexy'... but it can create astounding levels of wealth for investors who follow it." Market NotesA "STEALTH" PLAY ON THE U.S. HOUSING RECOVERY The uptrend in housing continues... and superinvestor Warren Buffett is in on the action.
Starting in April 2012, DailyWealth Trader encouraged readers to see Buffett's Berkshire Hathaway as a "stealth" play on the U.S. housing recovery. Many of the businesses Berkshire owns benefit from a booming housing market...
For example, Berkshire holds an 8.7% stake in Wells Fargo... the country's largest bank by market cap. Wells Fargo provides more than one-quarter of all U.S. mortgages. Berkshire also owns a brick maker, a carpet maker, a paint maker, a company that produces building insulation, and a homebuilder.
In short, what's good for U.S. housing is good for Berkshire. And with house prices rising, Berkshire's businesses are booming. Berkshire's share price is, too. In the past six months, shares have gained 30%. They hit a new all-time high this week.
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