Our “Safe Money” Dividend Trade Is Still Working…
The “dividend momentum” trade is still one of the strongest things going these days…
Over the past 10 years, Stansberry & Associates has stressed the importance of dividends and high-quality stocks hundreds of times. We practically went to your house and made you buy them. Our colleague Dan Ferris even coined the term “World Dominating Dividend Growers” to drive the point home.
In a world full of fraud, getting paid steady and growing cash dividends is one of the market‘s best strategies… even when it comes to short-term trading…#-ad_banner-#
In the past four months, we’ve highlighted how more and more people are recognizing the power of basic dividend-payers. With interest rates low, the fashionable thing on Wall Street will be for fund managers to say, “I own safe blue-chip dividend-payers.“
Making this idea even more attractive is how well blue-chip dividend-payers held up during last year’s huge market selloff. Riskier stocks fell 25%-50% in just a few months. But most of our favorite dividend-payers held up just fine.
That’s why over the past four months, folks have been piling into elite dividend-payers like Wal-Mart, Intel, and Microsoft… caused a surge of buying momentum… and have sent their share prices skyrocketing.
And while the broad market struggles with its recent correction, many “dividend momentum” stocks are reaching all-time highs. Take Coke, for example…
Coke is one of the greatest brand names in the world. It provides products that never go out of style… and provides consumers a small bit of pleasure for less than a few bucks. This makes it one of the most reliable dividend stocks in the world. As you can see from the chart below, it’s drawing huge money flows because of it.
Shares have climbed 10% in the past three months (a big move in such a short time for a stable blue chip)… and just struck a new 52-week high.
Coke’s move is impressive when you consider that many stocks (even Apple) have sold off in the past few weeks. And Coke isn’t alone. Fellow stable dividend-payers Altria and Hershey are also at or near 52-week highs.
Longtime Stansberry & Associates readers know we recommeded “trading” these blue-chip uptrends by selling put options or selling covered call options. These strategies are a great way to generate double-digit income streams on a safe portfolio.
As Coca-Cola and its fellow stalwarts have proved in the past few weeks, this idea is still working.