93.43 -0.02 (-0.02%)
After hours: 6:14PM EDT
|Bid||93.43 x 2200|
|Ask||93.43 x 1100|
|Day's Range||93.18 - 93.93|
|52 Week Range||71.08 - 94.07|
|PE Ratio (TTM)||N/A|
|Beta (3Y Monthly)||0.54|
|Expense Ratio (net)||0.12%|
The Fed slashed interest rates for the second time since the financial crisis by 25 bps to 1.75-2% in its policy meeting to sustain a decade-long economic expansion.
In times of uncertainty with rates under pressure as investors shifted to safe-haven plays, attractive yield-generating sector ETFs covering the real estate and utilities segments outperformed, and touched ...
There was plenty of talk about the inverted yield curve last month, the scenario where 10-year Treasury yields creep above the yields on two-year notes, and that chatter is usually ominous in nature because the inverted yield curve has often been a reliable recession indicator. The inverted yield curve doesn't have to be all gloom and doom. Some historical data points indicate there are opportunities when the scenario occurs, including with real estate investment trusts, which often outperform a year after the yield curve inverts.
The U.S. stock market continues to hit turbulence. Whether due to concerns over the ongoing trade war between the U.S. and China, increasing media attention on a possible U.S. recession or other economic challenges, it behooves you to make sure that your portfolio is set up to deal with risk while still generating growth and income.The U.S. economy remains a haven as much of the rest of the major economies of the world are slowing or are headed into recession. Meanwhile, the U.S. Gross Domestic Product (GDP) remains firmly in the positive -- with expectations for full year 2019 GDP to be a positive 2.50%.InvestorPlace - Stock Market News, Stock Advice & Trading TipsMeanwhile, inflation remains down and low in the U.S. The Federal Reserve Bank's preferred gauge of inflation, the core Personal Consumer Expenditure Index (PCE), is running at a scant 1.60% down -- from January's high of 1.77%. In addition, inflation outside the U.S. continues to be low -- to the consternation of central banks.The underpinnings of the U.S. economy remain positive with consumers very much engaged and comfortable to keep spending. This is evidenced by the broad weekly survey results by Bloomberg in its Consumer Comfort Index, which remains up significantly over the trailing year at a current level of 61.50.But none of that is stopping traders from sending stocks gyrating up and down. Volatility spiked dramatically over the month of August.This has resulted in the S&P 500 Index being down 4.68% from recent highs in late July of this year.Meanwhile, U.S. bond yields continue to decline -- sending some to suggest that this is representative of a signal of a possible U.S. recession. But instead, as a former bond trader and bond investment manager, I argue that there are substantial reasons for lower yields and higher bond prices. Inflation, as noted above, is low and falling -- aiding bond prices. And issuance in the bond market outside of U.S. Treasuries is not keeping up with demand -- particularly in corporate bonds and municipal bonds.In addition, outside the U.S., bond yields for government and corporate issues continues to head deeper into negative territory. This means that bond investors are effectively paying to own bonds. And the market amount of negatively yielding bonds has just reached a new high of just shy of $17 trillion.This makes the US bond market all the more attractive with the still positive yields in Treasuries as well as corporate and municipal bonds. Total Amount of Negative Yielding Bonds Where to Go for Income and GrowthThere are specific segments of the markets which continue to deliver during downturns in the general S&P 500 Index. Each of these segments is exclusively or predominantly focused on the U.S. economy and markets, and each has a proven history of sustained and well-defended dividend flows.And thanks to the vast and seemingly ever-expanding ETF market, there are specific ETFs with successful tracking of the leading defensive segments. And in particular, Vanguard has a great series of ETFs with lower expense costs as well as ample liquidity in the market. REIT ETFs to BuyOne of the best defensive segments remains the real estate investment trust (REIT) market. REITs continue to fare well during both good and challenging times. The underlying security of real assets which in turn generate ample income to fuel dividend distributions remains a compelling case for investors. And thanks to the Tax Cuts & Jobs Act of 2017, REITs dividends come with a 20% tax-deduction, making the REIT yields even more attractive.And over the past five years, REITs have returned 55.75% -- for an average annual equivalent return of 9.26% as tracked by the Bloomberg U.S. REITs Index.Vanguard has its Vanguard Real Estate ETF (NYSEARCA:VNQ) which has performed mostly in line with the REIT market index with the ETF actually outpacing the Index year to date with a return of 24.72%. Best ETFs to Buy From the Utilities SectorNext is the U.S. Utilities market sector. Utilities continue to benefit from lower inflation and interest rates, which reduces their funding costs while also making their dividend yields all the more valuable for investors. And since most utility dividends are qualified -- the income tax liability is lower for most investors' tax-brackets.Utilities are U.S.-focused and also come with the benefit of regulated rates and profit margins for their general regulated operations. This provides certainty for both good and challenging economic times. And with the U.S. economy remaining in growth mode, demand for many essential services -- especially electric power -- is on the ascent in the U.S.In addition, many utilities also run extra non-regulated wholesale businesses ranging from wholesale power distribution and/or transmission or natural gas sales and transmission. This adds to the revenues for dividends as well as fueling additional growth.Over the past five years, U.S. utilities, as tracked by the S&P 500 Utilities Index, have returned 72.94% for an average annual equivalent return of 11.58%.Vanguard has an excellent ETF in this market with its Vanguard Utilities ETF (NYSEARCA:VPU). It has kept up and even bettered the market Index over the past five years. And year to date it has returned 18.92%. ETFs to Buy From the Consumer SectorThen one of the traditional defensive market segments is the consumer staples market. This is because traditionally, during good and bad economic times consumers and households overall continue spend on the necessities for life. That concept got severely challenged in 2018 as many traditional leaders in this market ran into a buzz saw of changing consumer tastes for packaged and branded goods and costs including transportation rose squeezing margins.But while many are still challenged to focus on the right products and brands along with cost controls - others have dragged their feet with the market punishing them. That said, the segment has many successful turnarounds including Mondelez (NASDAQ:MDLZ), Procter & Gamble (NYSE:PG), Colgate-Palmolive (NYSE:CL) and even General Mills (NYSE:GIS).The market segment overall is up 54.23% over past five years for an average annual equivalent return of 9.05% as tracked by the S&P 500 Consumer Staples Index.Vanguard has a well-run ETF in this segment with its Vanguard Consumer Staples ETF (NYSEARCA:VDC). It has largely kept up with the Index. And for the year to date, the ETF has generated a return of 19.06%. And like for the utility stocks, most consumer goods stocks are tax-advantaged with qualified dividends. Investing in U.S. BondsU.S. Bonds, as noted above, continue to deliver positive yields with rising prices. And with the Fed on track to its money easing policies, including its target rate range for Fed Funds and its bond portfolio activities -- the market should be further supported.There are two segments of the U.S. bond market which you should focus upon. First is the corporate bond market. Yields are down with the rising credibility of issuers (who benefit from the supportive U.S. economy). And with less issuance and strong demand inside and from outside the U.S. -- the market is faring well.The U.S. corporate bond market, as tracked by the Bloomberg Barclays U.S. Corporate Index, has generated a return over the past five years of 25.07%. And for the year to date, the Index has done even better with a return of 14.11%.Vanguard has an excellent ETF in the corporate bond market with its Vanguard Intermediate-Term Corporate Bond ETF (NASDAQ:VCIT). It has fewer longer-term bonds synthetically represented in the ETF which has limited its performance year to date to 13.37%. But this also means that it is less susceptible to yield gyrations going forward.Then, I come to a favorite market of mine in bonds -- municipals. Municipal bonds are benefiting from a series of developments. First, U.S. bond yields overall, including Treasuries, are down. Second, the U.S. economy is doing well -- which bolsters tax revenues which in turn is reducing the need for issuance. This, along with better demand from outside the U.S., means rising bond prices. And third, the TCJA limited state and local tax deductions (SALT). This means that investors, particularly in higher taxed states, are ever more eager for more tax-free income.The U.S. municipal bond market has seen a return year to date of 20.81% as tracked by the Bloomberg Barclays Municipal Bond Index. Vanguard has an excellent municipal bond ETF with its Vanguard Tax-Exempt Bond Index ETF (NYSEARCA:VTEB). It has fairly matched the Bloomberg Barclays Index with a year-to-date return of 16.79%.And since I've presented my way to invest in a collection of all-weather ETFs, perhaps you might like to see more of my market research and recommendations for further safer growth and bigger reliable income. For more -- look at my Profitable Investing. Click here to learn more: https://profitableinvesting.investorplace.com/Neil George is the editor of Profitable Investing and does not have any holdings in the securities mentioned above.The post 5 All-Weather ETFs to Buy for Turbulent Markets appeared first on InvestorPlace.
The general U.S. stock market has hit some turbulence over the past few weeks. And much of this perhaps is due to a series of objections in the media to the further progress of the U.S. economy and the stock market.Since the recent peak in the S&P 500 Index on July 26, that index is down -- but the real estate investment trust (REIT) market as tracked by the Bloomberg U.S. REIT Index continued to be trading up.InvestorPlace - Stock Market News, Stock Advice & Trading TipsS&P 500 (Red) & Bloomberg U.S. REIT (Green) Indexes Source BloombergThis continues the defensive performance of REITs even during challenging times for the general U.S. stock market. August Can Be Rough for StocksHowever, it is good to note that August can be a challenging time for U.S. stock and bond markets. Trading desks get thinner as folks head to beaches, mountains and all sorts of places in between. Hedge fund gals and guys try to put things on autopilot, with junior partners left to man the con. And even private equity folks make bets that carried interest keeps their ship afloat for their vacation weeks.So when a few things hit the fan, the markets can swiftly get a little out of whack with the fundamentals. * 10 Marijuana Stocks That Could See 100% Gains, If Not More And this shows up in the U.S. stock market for this month with a surge in volatility. The 10-day volatility in the S&P 500 Index has surged from six-month lows of 5.57% on April 30 to a high on Aug. 15 of 29.21%. That means a whole lot of wildly swinging down and up in the process of the daily trading.S&P 500 Index 10-Day Historic Price Volatility Source BloombergVolume calculations are less accurate these days, as so many U.S. stocks trade off-exchanges and in private or dark pool exchanges. But from what we can see in volume -- for the same trailing six months -- the number of shares actually exchanging hands remained subdued.S&P 500 Index Daily Trading Volume Source BloombergThis leads me to recommend that you shouldn't get too worried about some of the recent general stock market gyrations. Instead, focus on what continues to work for investors -- a balance of largely U.S.-focused companies, particularly in real estate investment trusts (REITs). And I'll present my specific recommendations in a moment. Needless Headline RisksBut first, I want to present what I do see as a risk beyond near-term volatility. That is the proliferation of political spin on business and economic news. This is where leading newspapers, including the New York Times and the Washington Post, are running an increasing number of front-page stories arguing that U.S. consumers are set to pull back, businesses are frightened about the economy and that recession is near the horizon.This comes with a just-released survey by the National Association for Business Economics (NABE) which showed that of its members participating during the summer lull, 34% thought that perhaps the U.S. economy could slow into a recession in 2021. But that didn't stop mainstream news and financial news from running a doomsday message.I read and consume a whole pile of papers, magazines, journals and more daily, and I'm beginning to see more of this doomsday spin. It reminds me of one of Michael Crichton's books -- State of Fear.The book's plot involves public perceptions of global warming and the interests behind various messages of issues revolving around it. But it leads with an example of local television weather reporters. He wrote that the public's attention will wane unless you ramp up the hype of the potential worst outcomes of weather to get the viewing public into a frenzy and into a state of fear -- so that they can't help but to stay glued to the weather news. And that in the book he argued is what is being done to promote global warming. REITs Look PositiveThe risk for the general stock market is that the ramping up negative spin on economic news will begin to make consumers wary and in turn will slow the economy and damage the stock market. And remember - that the fourth quarter of last year came with a ramped up fear of slowing corporate earnings growth for the next year which led to selling which begat selling until rational heads came back and bought reality of sales and profits sending the S&P 500 Index soaring throughout this year.But again, REITs held up during the general market sell-off while providing ample dividend yield -- which further propelled the segment throughout 2019.But before you throw in the towel for the general stock market, it pays to look at how actual consumers are perceiving the economy as measured by the Bloomberg Consumer Comfort (Comfy) Index. They remain firmly comfy as they continue to be more so since late 2016. And while the level of the Index dropped last week -- it is still quite high with the next report coming this Aug. 22.Bloomberg Comfy Index Source BloombergAnd two of the larger retailers in the U.S. market -- Target (NYSE:TGT) and Walmart (NYSE:WMT) have reported continued stronger retail sales -- further confirming a buoyant consumer sector in the U.S. economy.But whether consumers pause or continue to participate, REITs remain one of the more attractive parts of the market for dividend income as well as defensive growth in the stock market. REITs Rule in Performance & ValueREITs not only have done better in the turbulent market of August as noted above, but over the past trailing year including the big downdraft in the S&P 500 Index in the fourth quarter of 2018.Over the trailing year -- the S&P 500 Index had a total return to date of 4.22% while REITs as tracked by the Bloomberg U.S. REIT Index generated a total return of 14.32%.Total Return S&P 500 Index (Orange) Bloomberg U.S. REIT Index (White) Source BloombergBut it isn't just that REITs continue to do better in the stock market. They also represent a better value right now. Comparing the S&P 500 and Bloomberg REIT Indexes, the average price-to-book value for the S&P is 3.35 times. REITs are a better value at only 2.74 times. And of course, the dividend yield of REITs at an average of 4.2% is measurably better than the barely there yield of the S&P at 1.9%. Which REITs to ChooseNow, one of the best ways to get easy access to a collection of great REITs is to do it synthetically with exchange-traded funds (ETFs).I'll start with a broad-REIT-market ETF with a ultra-low expense ratio in the Vanguard Real Estate ETF (NYSEARCA:VNQ). This is a great REIT ETF which I hold in the model portfolios of my Profitable Investing. The ETF has a dividend yield of 3.6% and has generated a return year to date of 24.3%.Next is another alternative to the Vanguard ETF with broad exposure to the general U.S. REIT market in the iShares Core U.S. REIT ETF (NYSEARCA:USRT). This, like the Vanguard ETF, has good overall exposure to U.S.-focused real estate companies. The dividend yield is a bit less at 2.9% and the performance year to date is running at a return of 21.7%.Then I'll move you onto a segment of the REIT market which I have favored for decades. Net leases in real estate are when companies lease properties. Then the tenants pay for taxes, insurance and general upkeep. This frees up the property owners from many expenses and risks. One of my favorite individual companies in this space is WP Carey (NYSE:WPC). And this REIT is one of the larger holdings of the NetLease Corporate Real Estate ETF (NYSEARCA:NETL). This ETF is newer to the market -- listing in March of this year. And since then it has returned 9.8% with a dividend that's starting with a yield of 2.1%.One of the particularly real estate segments involves medical properties and health and wellness properties for the aging in the U.S. One of my favorite individual health REITs is Ventas (VTR) which is represented in the Long-Term Care ETF (NASDAQ:OLD). This REIT ETF has generated a return year to date of 22.78% and has a dividend yielding 1.76%.And last up is another spin on the REIT market theme with mortgage REITs. Under the laws and tax codes of REITs, companies investing and managing mortgages on real estate properties can be set up in the hugely tax-advantaged REIT format. One of the best -- if not the best -- mortgage REITs which I have followed and recommended for so many years is MFA Financial (NYSE:MFA).MFA has proven itself through thick and thin - including during the worst in the mortgage markets during 2007-2008. And MFA is a major synthetic holding in the iShares Mortgage Real Estate ETF (BATS:REM). REM has a big yield of 10.1% and has generated a return year to date of 9.56%.Lastly, for those of you that attended and met me at the San Francisco MoneyShow last weekend -- my sincerest thank you. It is always gratifying to meet my readers of my research for InvestorPlace Media and for my subscribers to Profitable Investing.And since I've presented my way to invest in the successful and defensive REIT sector with ETFs, perhaps you might like to see more of my market research and recommendations for further safer growth and bigger reliable income. For more, look at my Profitable Investing. Click here to learn more: https://profitableinvesting.investorplace.com/Neil George is the editor of Profitable Investing and does not have any holdings in the securities mentioned above. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Marijuana Stocks to Ride High on the Farm Bill * 8 Biotech Stocks to Watch After the Q2 Earnings Season * 7 Unusual, Growth-Oriented REITs to Buy for Your Portfolio The post 5 REITs for Any Stock Market Conditions appeared first on InvestorPlace.
Real estate investment trusts (REITs) offer investors exposure to real estate without the sweat equity inherent through other means of investment like rental properties or property flipping. However, is ...
While volatility shook the markets, ETF investors may considered targeted sector plays that typically do well in times of heightened uncertainty. The CBOE Volatility Index, or so-called VIX, a gauge of ...
One of the most important questions that investors need to ask is how their portfolios will fare during times of crisis. When the S&P 500 Index takes a dive, will their investments dive alongside it? Or will hold up or even rally?Source: Shutterstock My approach in Profitable Investing is to present an allocation to both stocks and fixed income which provides growth and income along with shock absorbers to steady the gyrations of the general stock market.This comes with lots of income from my recommended dividend stocks, as well as the heavy income from coupons and interest paid by bonds, preferred stocks and related funds.InvestorPlace - Stock Market News, Stock Advice & Trading TipsBut I can offer further perspective on investments that work better during general stock market sell-offs. It only takes a few bits of financial history to see what worked when the S&P 500 Index wasn't your friend. How to Invest in a CrisisTake for example its recent move from its high on July 26 through Thursday. The S&P 500 Index dropped by 4.7% in price, and yet there were plenty of investments which were not just holding up, but rallying. * 8 Dividend Aristocrat Stocks to Buy Now No Matter What I'll start with real estate investment trusts (REITs). REITs continue to be a go-to investment sector during many of the challenging market times over last year and through 2019, including the drop from July 26. The Bloomberg US REIT Index was up 1.4% during the recent plunge.S&P 500 Index July 26 to Date Total Return (White) Against REITS (Orange) Utilities (Yellow) US Bonds (Red) and Franco-Nevada (FNV) (Green) Source BloombergREITs continue to fare well because of their solid, real assets which generate dependable revenue flows which in turn fuels ample dividend income. In addition, most U.S. REITs are either totally focused on the U.S. market or are mostly focused on the U.S. property market. This insulated them from the global economic malaise as well as trade tensions between the U.S. and China.Next up is the U.S. utilities market. Utilities as tracked by the S&P Utilities Index rallied by 0.34%. That's not much, but it beats losing money. Utilities continue to benefit from the dependability of solid regulated businesses which provide set profit margins. And they also benefit from additional growth and income from unregulated operations, providing ancillary operations from power generation and transmission to other larger-scale essential services.They therefore have dependable income for better dividends than for the general stock market with the addition of growth prospects from the continued improvement in the general US economy.Then there's the bond market. I've always been a fan of bonds. That was one of my focuses in my professional life. U.S. bonds continue to benefit from low and falling inflation, rising demand, limited new supply and improving credit conditions from many issuers of bonds. The Bloomberg Barclays Aggregate US Bond Market Index rallied for the period by 1.8% as traders got further on board as stocks were sinking.And of course, U.S. bonds are ever more attractive in their yield as more and more of the major global bond markets have ever deepening negative yields.And last up in my suggested arsenal of crisis investments is gold. But just owning gold isn't as good as my preferred way of owning gold which pays a dividend. Gold of course did rally for the same time period. But gold costs money to buy and store it. Even the SPDR Gold Shares ETF (NYSEARCA:GLD) costs 40 basis points (0.4%) per year to deal with its underlying assets. But for me, I like the idea of just buying the proceeds of ongoing gold production. This is called gold streaming. And one of the best in the business is Franco-Nevada (NYSE:FNV).This Canadian-based company has shares that easily trade on the U.S. exchanges. It doesn't mine gold, it buys and owns royalty and other interests in gold and other mineral production which streams income to the company. It then pays out part of the proceeds in the form of a dividend which currently yields 1.06%.And for the trailing year, Franco-Nevada outperformed GLD, with 33.1% in total return against 22.8%. And this isn't just a recent development, as the company has generated a return over the trailing five years which is better than GLD by a margin of 6.22 times better.Now, let's take a look at a stormier period of time for the S&P 500 Index -- the fourth quarter of 2018. The Index dropped by 14%, and yet the utilities rallied by 1.4%, U.S. Bonds rallied by 1.64% and my gold play in Franco-Nevada rallied to return 12.56%. Only REITs dropped, but by a much better margin than the S&P 500 Index. they lost 6.1%, far better than the plunge of the general stock market.Fourth Quarter 2018 Total Returns (Same as Above) Source BloombergNow, many REITs did much better than the overall U.S. REITs market. including one of my favorites -- WP Carey (NYSE:WPC) which generated a positive return for the fourth quarter by 3.21%. And during the plunge of Aug. 5 -- WPC held and rallied by 0.23% while the S&P 500 fell by 2.97%.For the general REIT market -- the easy-peasy way to gain crisis protection can by found in the Vanguard Real Estate ETF (NYSEARCA:VNQ). This provides synthetic exposure to the US REIT market at a ultra-low cost.And for U.S. utilities, Vanguard again is a good go-to source. Its Vanguard Utilities ETF (NYSEARCA:VPU) which provides good synthetic exposure to U.S. utilities at a low cost.For gold, I've already made part of my case for Franco-Nevada as the best gold play in the U.S. market.And for U.S. bonds I have another specific investment recommendation which subscribers of Profitable Investing will recognize. US bonds are performing very well this year with inflation low and falling with the core Personal Consumption Expenditure Index (PCE) falling over the trailing year to a current 1.60% - well below the Federal Reserve Bank Open Market Committee (FOMC) target above 2%.Core PCE Source BloombergU.S. bonds continue to perform well with the lower inflation and improving supply-and-demand conditions noted above. And when looking at the rest of the major global bond markets, the U.S. yields are still very much in the attractive positive range while the amount of negative yielding bonds keeps soaring in amount as non-U.S. bond investors are so desperate that they are effectively paying to own bonds. The total amount as tracked by Bloomberg & Barclays is now at $15.62 trillion.Amount of Negative Yielding Bonds Around the Globe Source Bloomberg & BarclaysNow, U.S. bonds have been good performers during crisis and prosperity this year with the overall return as tracked by Bloomberg Barclays at 8%. But I continue to advocate buying corporate higher-yielding bonds which have turned in a better return of 9.4% year to date.And one of the best means to capitalize on U.S. corporate higher-yielding bonds is to buy the BlackRock Credit Allocation Income Trust (NYSE:BTZ). This closed end fund yields 6% and yet trades at a whopping discount to its net asset value by 9.1%. And year to date, it has generated a return of 23.9%.Bloomberg Barclays US Aggregate and High Yield Returns Compared to BlackRock Credit Allocation Income Trust (BTZ) Year to Date Source BloombergNow I've presented my way to invest during the recent times of crisis, perhaps you might like to see more of my market research and recommendations for further safer growth and bigger reliable income. For more - look at my Profitable Investing. Click here to learn more.In addition, if you find yourself in San Francisco on Aug. 15-17, please join me at the MoneyShow, where I'll be presenting my economic and market analysis and my latest investment themes and recommendations. For more information, click here: https://www.moneyshow.com/Neil George is the editor of Profitable Investing and does not have any holdings in the securities mentioned above. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 8 Dividend Aristocrat Stocks to Buy Now No Matter What * 7 Stocks to Buy to Ride the Vegan Wave * 4 Safe Stocks to Buy Amid Trade War Turbulence The post Successful Crisis Investing (With Dividends!) appeared first on InvestorPlace.
Just because you're rich doesn't mean you're right, apparently. This year's mistake cost the wealthy an estimated $136 billion so far.
Many investors want a simple set-and-forget portfolio which will provide a balance between growth and income over time. And particularly if you are just beginning to build a portfolio, exchange-traded funds (ETFs) provide an easy and less expensive means to do this.Source: Shutterstock Inside my Profitable Investing, I have a large collection of model portfolios which are offered to achieve my goal of all-weather performance with lots of income and risk-controlled growth using stocks, bonds and funds -- including ETFs.For ETFs, your portfolio should be weighted to the best sectors of the U.S. markets, with shares in specific stock sectors that are geared to provide growth and income over time. As such, the stock ETF allocation should be set at 56% of your overall portfolio. I continue to recommend a roughly equal weighing for each of the funds you choose.InvestorPlace - Stock Market News, Stock Advice & Trading TipsThis same method applies in the fixed-income sectors that are focused on corporate bonds and preferred stock, as well as the buoyant municipal bond markets. The fixed-income allocation should be set at 44% overall, including an 11% allocation to cash. And like with the stock-based funds, the individual fixed-income ETFs should be weighted evenly. * 7 Retail Stocks to Buy for the Second Half of 2019 And note, the municipal bond ETFs can be bought in tax-free accounts. Some brokerages give warnings about this, but there are no restrictions to doing it. You will give up some of the tax-free income advantage, but the total return prospects for this market remain compelling. Stock AllocationsI'll start with the Vanguard High Dividend Yield ETF (NYSEARCA:VYM), for access to the general market with a dividend focus. VYM continues to do well year to date with a return of over 14%. Expenses are 0.6%, or just $6 annually for every $10,000 invested.That is the baseline for the stock market. Now let's move into one of the more attractive and defensive market sectors. REITs continue to gain from improving property values and rising income, fueling increasing dividends. Step into this sector safely with the Vanguard Real Estate ETF (NYSEARCA:VNQ). This ETF has resulting in a return year to date of 22% and expenses of 0.12%.Next we move on to the utilities market, which is also gaining from the security of essential services businesses. These, in turn, fuel ample and rising dividends. This sector should be bought with the Vanguard Utilities ETF (NYSEARCA:VPU), which has turned in a return year-to-date of 15.7% and carries expenses of 0.1%.Healthcare traditionally has been a reliable growth market through thick and thin. Americans continue to need more and more healthcare and related products -- again providing security in revenues and reliable dividends. This sector has, though, been affected by concerns over potential government changes in healthcare rules. But these concerns, while valid, are still well into the future, probably well beyond the 2020 election. You can invest here with the Vanguard Health Care ETF (NYSEARCA:VHT), which has generated a return to date of 10.8%. The expense ratio is 0.1%.Then we move to the technology market. This sector is challenged by the trade negotiations between the U.S. and China, which may further impact supply chains in China as well as sales all over the world. But the innovation engines remain on a fuller throttle, resulting in a return that dwarfs the general stock market. Buy in here with the Vanguard Information Technology ETF (NYSEARCA:VGT) with a return to date of 31.3% and expenses of 0.1%.The petroleum and energy markets remain uncertain. The supply of crude oil outside the U.S. continues to be threatened by internal hostilities in many Organization of Petroleum Exporting Countries (OPEC) and externally, by sanctions on others including some attacks on ships and pipelines in the Middle East. In the US, shale producers are pumping lots and infrastructure to transport it is coming online -- but the stockpiles are holding down prices.In addition, a slowing global economy is putting supply and demand models into a case for less demand, which is also putting a cap on prices.All this said, the U.S. companies remain great sources of cash flows and are fueling U.S. regional economic growth. And in turn -- they are generating ample cash for bigger dividends. The sector should be represented by the Energy Select Sector SPDR ETF (NYSEARCA:XLE) which has turned in a return year to date of 12.2%.Stock Sector Performance Year to Date Using Vanguard and SPDR ETFs Source Bloomberg Fixed-Income ETFs to Invest InAmong fixed-income allocations, you should have specific ETFs for corporate bonds, preferred stocks and municipal bonds.The U.S. economy continues to grow, with little inflation. This is providing excellent opportunities for specific sectors of the bond markets. Add in a docile Federal Reserve Bank which, while not cutting its target rate range for Fed Funds in the June meeting of its Open Market Committee (FOMC), is still expected to ease money conditions in the target range.Corporate bonds are doing well. The economy is bringing more revenues to companies, which in turn makes them better credit risks. And with yield above Treasuries, they drive more demand for these bonds. This sector should be bought with the SPDR Portfolio Intermediate Term Corporate Bond ETF (NYSEARCA:SPIB) which has generated a return year to date of 5.5% and a 12-month yield of 3.1%. Expenses are 0.07%.Next is preferred stocks. Preferred stocks are the bonds of the stock market. They provide the certainty of largely fixed dividends that are paid before dividends to common stockholders. They are defensive and bigger income-producing investments -- perfect for the current market. The sector should be bought with the iShares Preferred & Income Securities ETF (NASDAQ:PFF) which has generated a return to date of 8.8% and has a 12-month yield of 5.8%. Expenses are 0.46%.Municipal bonds continue from last year to be a go-to market for improving prices with yield premiums to U.S. Treasuries. With the economy doing better, tax revenues for most state and local authorities are improving as well, which in turn drives up the credibility and bond prices. The sector should be bought for total return and not just tax-free income with the Vanguard Tax-Exempt Bond ETF (NYSEARCA:VTEB) which has turned in a return to date of 4.1%. Its 12-month yield is 2.3% and expenses are 0.08%.Fixed Income Sector Year to Date Performance using Index Sector ETFs Source BloombergNow I've presented my way to build an all-weather ETF portfolio, perhaps you might like to see more of my market research and recommendations for further safer growth and bigger reliable income. For more - look at my Profitable Investing. Click here to learn more: https://profitableinvesting.investorplace.com/Neil George is the editor of Profitable Investing and does not have any holdings in the securities mentioned above. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Buy on College Students' Radars * 7 Retail Stocks to Buy for the Second Half of 2019 * The S&P 500's 5 Best Highest-Yielding Dividend Stocks The post 9 Set-It-And-Forget-It ETFs to Simplify Your Portfolio appeared first on InvestorPlace.
We have highlighted some investing ideas that could prove to be extremely beneficial for investors for the rest of the year in the current market environment.
With the strength of the labor market faltering, market participants expect the Federal Reserve to take a dovish stance on interest rates. What does this mean for REITs?
Summer has arrived and that could mean a boost in real estate activity as prospective buyers, especially parents, look for homes ahead of the start of the new school year in the fall. "According to the latest S&P CoreLogic Case-Shiller National Home Price Index, home prices in the United States grew by 3.5% in April," wrote Ralph McLaughlin, Deputy Chief Economist at real estate data company CoreLogic. A possible price uptick is starting to be felt in the priciest metropolitan areas, which could lead a forthcoming housing heat-up.
Learn about the difference in investing in a REIT for a single real estate company versus investing in a REIT ETF that tracks a larger REIT index.
Even though the cannabis industry is still in its infancy, investors looking for a marijuana stock with a dividend aren't completely out of luck. Income-seeking investors should look to Innovative Industrial Properties (NYSE:IIPR) as a possible pot play. IIPR is structured as a real estate investment trust (REIT) and to keep that favorable tax treatment, REITs must be out 90% of their operating income in the form of dividends.Source: Shutterstock Cannabis investing is still in its formative stages, but there are a few traits many marijuana stocks share in common. To be clear, we're talking about the industry's credible names that trade on major exchanges. Think Cronos Group Inc. (NASDAQ:CRON), Aphria (NYSE:APHA) and others.Essentially the entire universe of major cannabis stocks are considered growth names. It is merely a matter of whether they are mid- or small-cap growth stocks. As a result, investors searching for dividends in the marijuana space are not going to find a lot.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 5 Red-Hot IPO Stocks to Buy for the Long Run For the moment, the best way for investors in the U.S. to marry the concepts of dividends and cannabis stocks is with IIPR. IIPR Backstory Leads to a Wide MoatIIPR's backstory remains relevant today. Innovative Industrial Properties was able to procure its REIT status before President Trump won the White House. After Trump won, the company's rivals encountered difficulties securing the REIT treatment, essentially extending a competitive advantage to IIPR.Innovative Industrial Properties owns and operates industrial venues that are leased to legal medicinal cannabis firms. Moreover, IIPR fills an important void for many legitimate cannabis growers and operators: providing funding that is unobtainable at traditional banks.Business owners known getting a loan from a traditional bank is hard. When your business is considered illegal at the federal level and your bank is federally regulated -- as all banks are in the U.S. -- there is no avenue to financing at that bank.Innovative Industrial Properties' model is simple: it buys properties from growers that are regulated at the state level and leases those properties back to the growers. By selling to IIPR, the growers get much-needed capital without the hassle of being turned down by their local bank. The benefit to Innovative Industrial Properties is that the leases its tenants sign are usually long term, providing the company and its investors with revenue predictability and maybe down the road, low earnings variability.For those pondering how Innovative Industrial Properties is able to trade on a major U.S. exchange, the answer is twofold. First, the company does not actually touch marijuana plants or grow them. Second, Executive Chairman Alan Gold ran healthcare REIT BioMed Realty Trust prior to that company being sold in 2016, meaning he has a history of running a legitimate, NYSE-traded company. The Bottom Line on IIPRInnovative Industrial Properties has a lot going for it, including the aforementioned competitive advantage, which generates robust yields on its deals."Capital remains sufficiently scarce that IIP averages a 15% yield on its sale-leaseback deals," according to Barron's.However, positive traits do not always come cheap in financial markets. Due to their above-average dividend yields and defensive characteristics, REITs usually are not value stocks -- nor are price-to-earnings ratios generally useful metrics. You invest in REITs for the payouts, not necessarily price increases.However, Innovative Industrial Properties trades for nearly 106x times earnings, making it feel like an Internet stock dressed up as a REIT. Plus, the stock yields just 1.78%. That is less than what investors get on the S&P 500 and 10-year Treasuries, which are significantly less risky than shares of IIPR.However, many pot stocks don't have a P/E ratio at all -- because they don't yet have earnings. * 7 Top-Rated Biotech Stocks to Invest In Today Based on its steady funds from operations (FFO), Innovative Industrial Properties' valuation is not actually alarmingly high. Importantly, that FFO implies the company has adequate payout coverage and dividend growth potential.Todd Shriber does not own any of the aforementioned securities. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * The 7 Best Tech Stocks to Buy for the Second Half of 2019 * 7 Top-Rated Biotech Stocks to Invest In Today * 4 Semiconductor Stocks to Sell Compare Brokers The post Looking for a Pot Stock With a Wide Moat and a Dividend? Try IIPR appeared first on InvestorPlace.
It seems like forever ago, but the average 12-month certificate of deposit (CD) used to yield well more than 5%.In fact, prior to the tech wreck of 2000 - and the start of two decades of experimental monetary policy by the Federal Reserve - 5% would have been considered low. It wasn't usual to see CD yields over 10% in the 1980s. Those were the days!It's unlikely that we'll ever see 10% CD rates again in our lifetimes. Even 5% would seem like a stretch in a world in which the average 12-month CD still yields less than 1% after more than three years of Fed rate hikes.It's important to remember, though, that the high yields of the past came at a time of much higher inflation. At today's lower inflation rates, even a 3% yield allows you to stay well ahead of inflation. You're not getting rich quick at that yield, but it's respectable. And importantly, it can be done safely.Today, we're going to look at five safe ways to pocket a yield of at least 3%. While you might want to push for a higher return on your long-term investment portfolio, you can consider these as options for your cash savings that you might need in the next one to five years. SEE ALSO: 33 Ways to Get Higher Yields (Up to 12%!)
Just when it looked like the major U.S. equity benchmarks were poised to snap out of their recent doldrums, market participants sold modest early session gains, sending the Dow Jones Industrial Average, Nasdaq Composite and S&P 500 slightly lower in the afternoon, but buyers rallied late in the day to send all three indexes slightly higher.Source: Shutterstock The S&P 500 and Nasdaq Composite added 0.21% and 0.27%, respectively, while the Dow Jones Industrial Average rose by 0.17%. Eighteen Dow members finished higher Thursday, a day after just three closed up. Careful What You Wish ForThese should be the ideal days for investors to embrace defensive sectors, but some supposedly low-volatility names are betraying that reputation. As was noted in this space yesterday, the strong dollar is hampering consumer staples stocks.InvestorPlace - Stock Market News, Stock Advice & Trading TipsWalgreen Boots Alliance (NASDAQ:WBA) was the second-worst performer among the 30 Dow stocks Thursday, shedding 2.1%. The company, one of the largest pharmacy operators in the U.S., is in the midst of a cost-cutting effort that could see up to 200 of its Boots stores shuttered, but investors are not responding positively to that news. * 7 Stocks to Buy for Monster Growth Shares of the drug store giant now reside nearly 42% below the 52-week high, putting the stock in bear market territory two times over, and Walgreen Boots Alliance currently trades uncomfortably close to its 52-week low.Verizon Communications Inc. (NYSE:VZ) was the worst offender in the Dow today, sliding 2.3% after UBS downgraded the high-yielding telecommunications giant to "neutral" from "buy." UBS analyst John C. Hodulik reiterated a $59 price target on the stock, implying modest upside from Thursday's closing levels."Hodulik said that potential industry consolidation and the adoption of 5G technology might provide some upside to the shares, but any such benefit 'appears partially priced in," according to Barron's.Apple (NASDAQ:AAPL), one of the Dow's largest components, traded slightly lower on speculation that if China decides to use rare earths metals as a weapon in the trade war against the U.S., smartphone makers could be constrained by limited supplies.China dominates the market for rare earth metals and those metals are primary components in an array of consumer electronics, such as smartphones and tablets. Fears of crimped rare earth exports come as Apple is getting ready to unveil yet another iPhone."So even a short term action affecting production could have longer term consequences for the company," said Goldman Sachs, according to Barron's. Bottom Line on the Dow Jones TodayFor equity investors, it feels like there is nowhere to run to and nowhere to hide this month, but some familiar sectors are providing shelter from trade war storms. No the, real estate and utilities sectors, neither of which have any representation in the Dow, are not considered adventurous fare.However, the Utilities Select Sector SPDR (NYSEARCA:XLU) and the Vanguard Real Estate ETF (NYSEARCA:VNQ) are up modestly higher this month while the S&P 500 is down 5%.In terms of individual names to consider, Dow component Cisco Systems (NASDAQ:CSCO) is down more than 5% this month, but that may be a case of the baby being thrown out with the bathwater.In a note out Thursday, JPMorgan reiterated an "outperform" rating on Cisco, reminding investors about the company's relatively light China exposure. The stock yields 2.6%."Cisco remains our top pick for investors looking at safe havens in the current environment to navigate through the trade war noise," according to JPMorgan.Todd Shriber does not own any of the aforementioned securities. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 7 Stocks to Sell Amid an Escalating Trade War * 5 REITs to Buy While They're Dirt Cheap * The Only 3 Marijuana Stocks You Need to Own Compare Brokers The post Dow Jones Today: Another Day of Market Struggles appeared first on InvestorPlace.
'PodShare' is addressing the housing crisis facing cities like Los Angeles and San Francisco by selling customers beds in a communal home for $1,200 per month. Yahoo Finance's Seana Smith and PodShare CEO Elvina Beck discuss.