Forget These ULTRA High-Yield Stocks, I'd Rather Buy These Safe High-Yield Stocks Instead

► My Stock Portfolio + BUY and SELL alerts: https://patreon.com/jasonfieber
► Subscribe for new videos every day!: http://bit.ly/dai_youtube
► Early Retirement Blueprint: http://dividendsandincome.com/early-retirement-blueprint/

I've made a ton of videos on a simple concept that I can't seem to hammer home enough. Don't chase yield. I really can't say those three words enough. Despite my best efforts, we continue to get comments left and right about high-yield junk stocks. Patience is a virtue.

And it requires patience to see the compounding process play out over time. If you invest in high-quality dividend growth stocks, you'll likely see your wealth and passive dividend income exponentially grow.

Now, it takes time for that to happen. But I'm talking about returns that can beat the market over the long run. And dividend growth that can beat inflation. So it's having your cake (wealth) and eating it, too (income).

High-quality dividend growth stocks are like golden geese that lay ever-more golden eggs. But high-yield stocks that can pay out lots of income today entice naïve investors.

The first high-yield stock to avoid is AGNC Investment Corp. (AGNC).

AGNC is a real estate investment trust that primarily invests in residential mortgage-backed securities.

This is a classic high-yield trap that ensnares unsuspecting investors who look at the high yield and get all starry eyed. But here's the thing. AGNC has been a terrible investment for as long as I've been investing.

The stock yields a monstrous 9%.

This stock has declined by almost 20% over the last five years alone.

Instead, consider buying W.P. Carey Inc. (WPC).

W.P. Carey is a real estate investment trust that owns over 1,000 properties mostly in the US and Europe.

This stock yields 5.2%.

Whereas AGNC is down by almost 20% over the last five years, W.P. Carey is up by 17% over the last five years.

Would you rather lose wealth or gain wealth? Not a difficult choice, really. Meantime, W.P. Carey has increased its dividend for 24 consecutive years. The dividend is up by almost 7% since 2016.

Another high-yield stock to avoid is Prospect Capital Corporation (PSEC).

Prospect Capital Corporation is a business development company that makes debt and equity investments in middle-market businesses.

Like moths drawn in by the light of a flame to their own doom, some investors find themselves drawn in by super high yields to their own financial detriment. PSEC is a classic example of this.

This stock yield does yield a mouth-watering 8.8%.

And that's pretty much where the appeal begins and ends. This stock is down 2% over the last five years, even while the US stock market doubled over that stretch. Anyone who bought PSEC five years ago picked up some nice dividends along the way, but they were seeing their wealth destroyed in the process.

Adding insult to injury, PSEC's dividend has gone down over the last five years.

The dividend was over 8 cents/quarter per share in 2016. It's now at 6 cents. Their 28% dividend cut in 2017 has never been rectified. Yield chasers got attracted to the roughly 12% yield the stock offered in 2016. But all they ended up doing was missing out on big gains elsewhere, all while seeing their dividend income drop. It's the worst of both worlds.

Instead, consider buying Main Street Capital Corporation (MAIN).

Main Street Capital is a business development company that makes debt and equity investments in middle-market businesses.

Yep. Another BDC. Except Main Street Capital has been run significantly better over the years. I looked at both PSEC and MAIN years ago for an investment in my own portfolio. At the time, if I recall correctly, MAIN yielded about half that of PSEC. But I still chose MAIN because it appeared to be, after my research, the much better business. And I'm glad I chose wisely.

This stock is up 21% over the last five years.

The yield on this stock is a very nice 5.9%.

That's more than four times higher than the broader market's yield, and the dividend is paid monthly. Plus, you're getting solid business performance, stock performance, and dividend performance.

► Website: http://www.dividendsandincome.com/
► Patreon: http://bit.ly/dai_patreon

#UltraHighYields #SafeYields #HighYieldStocks $AGNC $WPC $MAIN $PSEC

LEGAL DISCLAIMER: Please consult with a licensed investment professional before investing any of your money. Never invest in a security or idea featured on this channel unless you can afford to lose your entire investment. If your money is not FDIC insured, it may decline in value. Jason is not a licensed financial advisor, tax professional, or stockbroker and he does not purport to be. The links above may include affiliate commissions paid to the owners of Dividends and Income and help support this channel.

Видео Forget These ULTRA High-Yield Stocks, I'd Rather Buy These Safe High-Yield Stocks Instead канала Dividends And Income