VTM looks at High Yielders

By Richard Mason


Portfolio managers tend to have an even spread of growth stocks for capital appreciation and income stocks for income in their portfolios. During the downturn in the markets most portfolio managers where looking for yield, but since the upturn, managers where less concerned with yield as capital gains were providing much better returns. Whilst growth stocks have been more appealing lately, we still thought it’s a good idea to pick out a few high yield stocks to potentially have in your portfolio.


Two UK insurers that are currently on a yield of 5.8% and 6.0% are Amlin plc (Ticker AML:LN) and Catlin Group (Ticker CGL:LN). Two UK investment companies that are currently on a yield of 8.9% and 6.9% areResolution (Ticker RSL:LN) and Man Group (Ticker EMG:LN).


Some of the best high yield European stocks include Banco Santander (Ticker SAN:SM) which is currently on a yield of 8.7%, GDF Suez (Ticker GSZ:FP) is on a yield of 7.5% or Zurich Insurance Group (Ticker ZURN:VX) is on a yield of 6.8%.


Four US stocks on exceptional yield are the ETRACS 2X Long WFC BDCI ETN (Ticker BDCL:US) is on a massive yield of 15.9%, Och-Ziff Capital Management (Ticker OZM:US) is on a yield of 14.7%, KCAP Financial (Ticker KCAP:US) is on a yield of 12.4% and Blackrock Kelso Capital Corp (Ticker BKCC:US) is on a yield of 11.3%.

Not only does adding these stocks to your portfolio allow for income, it also diversifies your geographic risk and currency risk. It is important to keep tabs on these sorts of companies as any possible cut in the dividend payout will affect the share price sharply negative, conversely, an increase in dividend will add to your capital gains. You should adjust your weightings on your holdings based on how you want your portfolio to perform, highly weighted on income stocks for income or highly weighted on growth stocks for capital appreciation. Note these stock choices are solely based on their dividend yield and due diligence should be carried out on the business before investing.


Author: Richard Mason

This article does not provide any financial advice and is not a recommendation to deal in any securities or product. Investments may fall in value and an investor may lose some or all of their investment. Past performance is not an indicator of future performance.

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