|Bid||83.00 x 900|
|Ask||85.00 x 800|
|Day's Range||83.51 - 84.66|
|52 Week Range||71.17 - 93.62|
|Beta (5Y Monthly)||0.41|
|PE Ratio (TTM)||37.57|
|Earnings Date||Feb 19, 2020 - Feb 23, 2020|
|Forward Dividend & Yield||4.15 (4.92%)|
|Ex-Dividend Date||Dec 29, 2019|
|1y Target Est||86.38|
It hasn't been the best quarter for W. P. Carey Inc. (NYSE:WPC) shareholders, since the share price has fallen 11% in...
W. P. Carey Inc. (NYSE: WPC), a leading net lease REIT specializing in corporate sale-leasebacks, build-to-suits and the acquisition of single-tenant net lease properties, today announced the acquisition of a 726,000 square foot (67,500 square meters) Class-A, cross-docked logistics facility in the U.K. for $112 million (£85 million) in an off-market transaction. The mission-critical facility is net leased to the U.K. operating subsidiary of Dixons Carphone plc ("Dixons"), a publicly listed multinational electronics and telecommunications retailer and services company.
W. P. Carey Inc. (NYSE: WPC), a leading net lease REIT specializing in corporate sale-leasebacks, build-to-suits and the acquisition of single-tenant net lease properties, today announced six investments completed during the 2019 fourth quarter totaling approximately $282 million and more than 2.7 million square feet. The investments are located in the U.S. and Europe and are diversified across property types. The properties are triple-net leased to industry-leading tenants with a weighted-average lease term of approximately 20 years.
W. P. Carey Inc. (NYSE: WPC) reported today that its Board of Directors increased its quarterly cash dividend to $1.038 per share, equivalent to an annualized dividend rate of $4.15 per share and marking W. P. Carey's 75th consecutive quarterly dividend increase since going public in 1998. The dividend is payable on January 15, 2020 to stockholders of record as of December 31, 2019.
The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. Insider Monkey finished processing more than 750 13F filings submitted by hedge funds and prominent investors. These filings show these funds' portfolio positions as of September […]
Real estate investment trusts (REITs) - companies that invest in a variety of properties, from office buildings to apartments and self-storage buildings - built big gains in 2019.A prominent REIT gauge, the FTSE Nareit All Equity REIT Index, gained 25.4% through Nov. 21 (including dividends), with many of the best REITs doing far better. In contrast, the small-cap Russell 2000 Index (used for comparison because the majority of REITs are smaller companies) has gained 18.9%.Of course, people don't ordinarily invest in REITs to beat the stock market averages. They invest in them for income. By law, REITs must pay out at least 90% of their net earnings as dividends. The average REIT in the FTSE index delivers a dividend yield of 3.6%, compared with 1.8% for both the bellwether 10-year Treasury note and the S&P; 500\. When the yield of bonds and stocks are so low, REITs become extremely popular.Real estate also provides diversification. While REITs are still stocks, they don't always move in the same direction as the broad market. And their above-average dividend yields are a nice shelter in a downturn.While you can invest in a real estate fund, such as the Vanguard Real Estate ETF (VNQ), there are plenty of good individual REITs to buy, many of which offer high yields and reasonable valuations, despite the sector's towering heights this year. "REITs are not a homogenous group," says Chris Kuiper, equity analyst at CFRA Research. In just the past year, REITs have a performance difference of 160 percentage points.Which ones have the top prospects for the future? Read on as we examine the 10 best REITs to buy for 2020. SEE ALSO: The 20 Best Stocks for 2020
W.P. Carey (WPC) delivered FFO and revenue surprises of 2.36% and 0.36%, respectively, for the quarter ended September 2019. Do the numbers hold clues to what lies ahead for the stock?
NEW YORK , Nov. 1, 2019 /PRNewswire/ -- W. P. Carey Inc. (NYSE: WPC) (W. P. Carey or the Company), a net lease real estate investment trust, today reported its financial results for the third quarter ended ...
[Editor's note: This article was previously published on Sept. 13, 2019. Due to changes in the market since then, parts of this article have been rewritten with new information.]The holidays represent great opportunities to take a good look at your portfolio and make sure that you are good to get through the holiday buzz and into the new year. And this season starts with Halloween -- also known as All Hallows Eve. Halloween is celebrated with all sorts of scary stuff that's just for fun. But the markets can bring a whole lot of genuinely scary troubles that you should avoid with the right stocks.After Halloween we come quickly up to Thanksgiving and hopefully to a great feast with family and friends. And again, it should be another good time to make sure that you have stocks that you will be thankful for now and in the months to follow.InvestorPlace - Stock Market News, Stock Advice & Trading TipsChristmas brings the annual cornucopia of gifts complete with all of the cash needed to make everyone on your list a happy recipient. And having the right stocks inside your portfolio can be a great aid to your budget.For all three of these holidays, safer, dividend-paying stocks can tick many of the right boxes for your portfolio. Dividend stocks tend to be more defensive during the scary times of the markets. And dividend stocks provide lots of cash flows to be thankful for at Thanksgiving.I have always had a core focus on dividend stocks and bonds for both income and safer growth over time. And in my Profitable Investing I have my all-weather model portfolios chock-full of recommendations.Here are some prime examples that you can put to work for the holidays and into 2020 right now. Dividend Stocks to Buy: W. P. Carey (WPC)I start with W. P. Carey (NYSE:WPC) which is a highly successful real estate investment trust with a diverse collection of properties across segments. But what they all have in common is the company's signature structure of sale and leaseback triple-net leases. This is where W. P. Carey typically acquires a property from a significant company -- or even government entity -- and in turn leases it back to the seller for long-term lease. In addition, the tenant pays for the taxes, insurance and general upkeep, hence the term triple-net.This structure has major benefits. To start, W. P. Carey gets established tenants for its leased properties. And longer-term leases set the company up with more dependable income. Because the tenants cover taxes, insurance and maintenance, W. P. Carey escapes a whole lot of uncertainty.Revenues are up for the trailing year by 4.4%. The return on funds from operations -- which measures the profitability of just running the properties -- is at a very healthy 12.8%.And the dividend is running at 4.5%. The actual distributions have been rising each and every quarter for years and years making the company one of the true dividend aristocrats.The stock has generated a return over the trailing five years of 86.3% for an average annual equivalent of 13.2% * 7 Dividend Stocks That Could Struggle to Continue Payout Hikes And despite the quality of the company's assets and performance along with that rising dividend distribution, the stock is cheap compared to the general REIT market. The stock's price is valued at a mere 2.2 times book value which is significantly cheaper than the general market average of 2.7 times. This make WPC a cheap stock with great assets and a rising dividend. AT&T (T)Next is a very old and proven company, AT&T (NYSE:T). It offers a variety of services including streaming. And oh yes, it comes with a huge content warehouse and generator in Warner Brothers.The direct comparison stock is Verizon (NYSE:VZ) which is a good dividend stock. But AT&T is way, way cheaper. AT&T stock is at a mere 1.5 times book compared to Verizon's value of 4.3 times book.Revenue is rising with the trailing year up by 6.4% and while the company has a lot of components, overall operating margins are running at a fat 15.3%. That in in turn drives a nice return on equity running at 8.9%.It has built up debt in its acquisition of Time Warner -- but it is manageable at only 33.2% of assets.The stock has trailed Verizon until recently. Activist investor Paul Singer announced that he has amassed $3.2 billion of the company's stock. He wants AT&T to hone its focus and sell some of its superfluous operations. And the market likes what he's presenting. AT&T also likes the ideas and is now moving to divest some of its non-essential businesses, pay down some debt, buy back some shares, split the CEO and Board chair positions and add two board seats.Over the past five years, the stock has returned 46.3% for an average annual equivalent return of 7.9%. But year-to-date, the stock has returned 43%.The dividend is running with a yield of 5.3% and the distributions have been rising over the trailing five years by an average of 2.1% per year. These are all reasons why AT&T is a good dividend stock to buy now. AllianceBernstein (AB)Now I'll move to another industry and a stock that you might not recognize -- even if you invest in some of its well-run funds. AllianceBernstein (NYSE:AB) is a pass-through company in the asset management business. The key thing about asset managers is that it is all about the assets under management. They don't have to be exceptional in their investing -- just good enough to attract and keep assets on which they earn fees year in and year out.The company's assets under management figure has climbed by 25.8% over the trailing four years to a current $581 billion. That has resulted in revenue gains for the same period of 30.1%.This in turn is driving higher returns for shareholders with the return on equity running at 14.9%. But the real deal is that the shares trade at a discount to revenue by nearly 20% -- making the shares cheap. * 10 Stocks to Buy Regardless of Q3 Earnings The stock has been a good performer with the trailing five years generating a total return of 69% for average annual equivalent of 11.1%. Compass Diversified (CODI)Here is a stock from another company that perhaps you haven't had the fortune to know: Compass Diversified (NYSE:CODI). It's an investment holding company set up under the Investment Company Act of 1940. As such it operates without federal corporate income taxes, providing further cash for dividend payments to investors.CODI buys and owns a collection of well-branded industrial and consumer goods companies. You can think of it as a smaller and more nimble Berkshire Hathaway (NYSE:BRK.A, NYSE:BRK.B). And Compass Diversified in turn works with management teams to further develop business values. When appropriate, it will also sell off companies.Along the way, CODI collects ample cash flows from the operating companies and in turn pays a dividend currently yielding 7.1%.Revenues are firmly on the rise with the trailing year's sales gain of 33.2%. Margins are positive, helping to drive a return on shareholder equity of 39.3%. And the stock is very cheap as it is valued at a 30% discount to trailing sales -- which as noted are firmly on the rise.Compass Diversified continues to deliver. Over the past five years shares have generated a total return of 70.3% for an average annual equivalent return of 11.2%. TPG Specialty Lending (TSLX)Last up in my list of divided stocks for the holidays is TPG Specialty Lending (NYSE:TSLX). This company is one of the alternative financial companies capitalizing on the combination of less regulation and higher capital requirements imposed on U.S. banks.Revenues are up on a tear with the trailing year climbing by 24.2%. Its net interest margin is running at 10% and it keeps its efficiency ratio humming at a profitable 31.5% -- which means it costs 31.5 cents to earn each dollar of revenue.The company has generated a return of 100.2% over the trailing five years for an average annual equivalent of 14.9%. TSLX pays regular dividends quarterly, providing a yield of 7.4%. But it also regularly pays additional dividends from ongoing profits for a current annual yield of 8.3%.In addition, since it is set up under the Investment Company Act of 1940 and the Small Business Investment Incentives Act of 1980, it avoids federal income taxes. This leaves more cash to feed that dividend. So, the company is cheaply run with great margins and a great dividend stream. TSLX is a great value right now.For more of my dividend paying stocks, please take a look at my Profitable Investing which is celebrating 30 years of publication. Click here to learn more. In addition, I have recently had a book published titled Income for Life. For more information on it click here. It is nearly 400 pages of income-producing investment strategies for all-weather economic conditions as well as additional income-producing ideas that anyone can use successfully.Neil George was once an all-star bond trader, but now he works morning and night to steer readers away from traps -- and into safe, top-performing income investments. Neil's new income program is a cash-generating machine … one that can help you collect $208 every day the market's open. Neil does not have any holdings in the securities mentioned above. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Battered Tech Stocks to Buy Now * 7 Strong-Buy Stocks Hedge Funds Are Buying Now * The 7 Best Penny Stocks to Buy The post 5 Excellent Dividend Stocks to Buy for the Holiday Season appeared first on InvestorPlace.
While Extra Space Storage (EXR) registers growth in same-store revenues and NOI, same-store square foot occupancy remains flat year over year.
Is W.P. Carey Inc. (NYSE:WPC) a good bet right now? We like to analyze hedge fund sentiment before conducting days of in-depth research. We do so because hedge funds and other elite investors have numerous Ivy League graduates, expert network advisers, and supply chain tipsters working or consulting for them. There is not a shortage […]
Conference Call Scheduled for 10:00 a.m. Eastern Time NEW YORK , Oct. 18, 2019 /PRNewswire/ -- W. P. Carey Inc. (NYSE: WPC), a net lease real estate investment trust, announced today that it will release ...
$69 Million (€63 Million) of Completed Sale-Leasebacks and $55 Million (€50 Million) Build-to-Suit Commitment NEW YORK , Oct. 7, 2019 /PRNewswire/ -- W. P. Carey Inc. (NYSE: WPC), a leading net lease REIT ...
Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is...
The traditional wisdom for funding retirement used to be the "4% rule." You would withdraw 4% of your savings in year one, followed by "pay raises" in each subsequent year to account for inflation. The theory: If you're invested in a mix of dividend stocks, bonds and even a few growth stocks, your money should last across a 30-year retirement.But today's world is different. Interest rates and bond yields have been stuck in the basement for far too long, reducing future expected returns. Compounding the problem: Americans are living longer than ever before.If you're wondering how to retire without facing the uncomfortable decision of what securities to sell, or questioning whether you are at risk of outliving your savings, wonder no more. You can lean on the cash from dividend stocks to fund a substantial portion of your retirement. In fact, Simply Safe Dividends has published an in-depth guide about living on dividends in retirement.Many companies in the market yield 4% or more. And if you rely on solid dividend stocks for that 4% annually, you won't have to worry as much about the market's unpredictable fluctuations. Better still, because you likely won't have to dig into your nest egg as much, you'll have a chance to leave your heirs with a sizable portfolio when the time comes.Here are 20 high-quality dividend stocks, yielding on average above 4%, that should fund at least 20 years of retirement, if not more. They have paid uninterrupted dividends for more than 20 consecutive years, have fundamentally secure payouts and have the potential to collectively grow their dividends to protect investors' purchasing power over time. SEE ALSO: The Berkshire Hathaway Portfolio: All 47 Buffett Stocks Explained
NEW YORK , Sept. 18, 2019 /PRNewswire/ -- W. P. Carey Inc. (NYSE: WPC) reported today that its Board of Directors increased its quarterly cash dividend to $1.036 per share, equivalent to an annualized ...
With fixed annual rent escalations, weighted average lease term of 22 years and an asset class experiencing high demand, W. P. Carey's (WPC) industrial investments seem a strategic fit.
$45 Million Completed Sale-Leasebacks and $66 Million Forward Commitment for Highly-Critical Assets NEW YORK , Sept. 16, 2019 /PRNewswire/ -- W. P. Carey Inc. (NYSE:WPC), a leading net lease REIT specializing ...
NEW YORK, Sept. 10, 2019 /PRNewswire/ -- W. P. Carey Inc. (WPC) announced today that it has priced an underwritten public offering of €500 million aggregate principal amount of 1.350% Senior Notes due April 15, 2028 (the "Notes"), which will be issued by its indirectly wholly-owned subsidiary, WPC Eurobond B.V. (the "Issuer"), and shall be fully, unconditionally and irrevocably guaranteed by W. P. Carey Inc. The Notes were offered at 99.266% of the principal amount and application for listing has been made by the Issuer with the Irish Stock Exchange plc, trading as Euronext Dublin, for trading on the Global Exchange Market, and any listing is subject to approval by Euronext Dublin. The offering of the Notes is expected to settle on September 19, 2019, subject to customary closing conditions.
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.
By now you've heard plenty of talking heads on television saying all sorts of scary things about the inverted yield curve for United States Treasury bonds. And if you missed the headlines, you'll be reading them popping up in news feeds and in the papers.Source: Shutterstock A yield curve is the plotting of bond maturities and their yields from shorter-to-longer-term. It shows how the market for any type of bond is being bought and traded. Normally, shorter-term bonds have lower yields than longer-term maturities.This is because the longer the maturity, the greater the risk of inflation baring its claws making for future interest payments. This also means that the eventual principal payment will be worth less in inflation-adjust terms. Longer-term yields tend to be lower because they must also price in credit risk. The longer the maturity, the greater time for credit in any given market sector to gyrate or deteriorate, putting future interest and principal payments at risk.InvestorPlace - Stock Market News, Stock Advice & Trading TipsA normal yield curve should connect the dots of yield on the y-axis and maturities on the x-axis. It normally rises in yield as maturity dates stretch out. What Does Today's Yield Curve Mean?But an inverted yield curve is when shorter-term maturities are yielding more than longer-term maturities. And when it comes to the U.S. Treasury bond market, the generally accepted definition is when the 2-year Treasury yield is lower than the 10-year Treasury yield. * 10 Stocks Under $5 to Buy for Fall This kicked in early yesterday when the 2-year was at a little bit past 6:00 a.m. I was working to finish up my papers with my Bloomberg Terminal humming along. The 10-year dropped to 1.62% and the 2-year was sitting at 1.63%. This hasn't happened since 2007, when on Feb. 22 the spread was a negative 15.41 basis points, or 0.1541%.Today's Trading (In Yield%) for U.S. 2-and-10-Year TreasuriesHistory of Yield Spread between 2 and 10-Year U.S. Treasury Bonds Now since yesterday morning, the bond market has sent the spread back to positive, which is normal, for the 2-and-10-year maturity yields. Before I get into what this means, what is causing it, why you should care and what you need to do -- let's look at what the U.S. Treasury bond market has done over the trailing year.From Aug. 14, 2018 through to yesterday, Treasury yields outside of the 1-month bills have all dropped, and longer maturities have dropped even more.In the next graph I've plotted the curves for both dates and the resulting yield changes.U.S. Treasury Bonds (Actively Traded) Aug. 14, 2018 and YesterdayWhat has been causing this to occur? First up, the U.S. Treasury has been issuing more bonds with shorter maturities for some time as part of their funding for the U.S. government. This means more supply, which will influence market pricing. Second, inflation has been low and generally falling over the past many months.The Personal Consumption Expenditure Index, which is the prime gauge used by the the Federal Reserve and its Open Market Committee, has gone from bobbling around the 2% down to a current level of 1.6%. The PCE is a much better and more broad inflation gauge than the Consumer Price Index, as the PCE measures all consumption and not the contrived basket of goods and implied costs for other things including residential expenses.U.S. Core Personal Consumption Expenditure IndexAnd the core PCE, which is also calculated in quarterly Gross Domestic Product data, is running for the second-quarter data release at a rate of 1.4% in the deflator calculations of the GDP growth rate of 2.4%.So, inflation is low and down, and well below the stated target range of the FOMC of above 2% -- and even higher for what it deems as a healthy level for a growing economy.This means that while the FOMC has already reversed course with its target range for Fed funds at its July 31 meetings, I think it is likely that it will further ease in its meetings concluding on Sept. 18, Oct. 30 and Dec. 11 of this year. This reversal of target ranges for Fed funds is reminiscent of when it reversed in 1995-1996 and in 1998.This makes longer-term bonds all the more valuable to lock in yields for the longer term. Now normally, falling yields means falling GDP growth and a weakening economy. But that isn't as much the case right now. Growth in the U.S. economy remains good as just noted above for the most recent data, and there is good reason to see it continuing. U.S. consumer spending drives the vast majority of the economy. And my preferred gauge of consumers is the Bloomberg Consumer Comfort Index, which I refer to as the "Comfy Index."Bloomberg Comfy IndexSince late 2016, the Comfy Index has been climbing and is very well-positioned in the excellent range. This means that consumers should be eager to spend and have the ability to do so -- particularly as U.S. wage growth has continued to be multiples of core PCE inflation.And businesses continue to expect rising activity over the next six months, as I utilize the Federal Reserve Bank of New York's survey data for projections.U.S. Business Leaders Expected Business Activity (Six Months Forward)So, rather than the sickening economy that many are worried about, the U.S. economy continues to show better conditions. What Is Happening With the U.S. EconomyBut what really is happening is that the U.S. is the haven economy in a world where Europe is in trouble and the leading economies of Asia are slowing. And as a result, yields for government bonds from the leading issuers in Europe and Asia are increasingly heading into negative yields.Negative yield come as coupon rates (stated interest rates) are issued at low or near-zero rates. The markets at auction as well as the secondary market bids the bonds to prices above par ($100), which brings the yields below zero. Take for example a German bund (government bond) with a coupon of 0.5% and a maturity of Feb. 15, 2025. It has recently been trading in the market for $106.75 which means that for each bund you'll pay $1,067.50 euros along with $2.19 euros in accrued interest for an effective yield to maturity of -0.69%. That's because the bund will mature at $100, or $1,000 euros, which prices in a loss of $67.50 euros and offsets the coupons.Negative yields and interest rates around the world beyond the U.S. are rapidly becoming a growing problem as the amount of bonds with negative yields keeps climbing by the day to a current level of $15.8 trillion.Negative Yield Debt Around the GlobeThis in turn is making the U.S. bond market all the more attractive with positive yield, and is driving more buying from investors in the U.S. and beyond. And with more buying of longer-term bonds, yields are down and prices are up. Why Investors Should Care About the Inverted Yield CurveYou should care, because this is good -- for now -- for the U.S. economy. Lower interest rates and yields means lower borrowing costs for everyone from the government to corporations and individuals. And this in turn should further aid the growth of the U.S. economy, along with lower inflation pressures over time with lower borrowing costs.And this shows up in how well U.S. bonds are performing in total return from all bonds to my preferred markets in higher-yielding corporate bonds and municipal bonds.Look at the performance year to date for all U.S. bonds (in aggregate), corporate high yield and municipal bonds as tracked by Bloomberg Barclays.U.S. Aggregate Bond (White), U.S. High Yield Corporates (Orange) and Municipal Bonds Total ReturnOverall, U.S. bonds in aggregate have returned 8% year to date. Corporate high-yielding bonds have returned almost 10% and municipal bonds generated 7%. Securities to Focus OnNow, stocks have been choppy recently -- with trade tariff concerns and global economic trouble outside the U.S. But not all stocks have been in the crosshairs of sellers. I continue to guide my Profitable Investing subscribers to hone in on U.S.-focused stocks. This list includes real estate investment trusts such as my favorite W.P. Carey (NYSE:WPC) and utilities such as my favorite NextEra Energy (NYSE:NEE). And these sectors have been and should continue to benefit from lower U.S. interest rates and yields.And with mortgage loans climbing with rising property market values and consumer confidence, U.S. mortgage investment companies such as my MFA Financial (NYSE:MFA) should continue to deliver.But for U.S. bonds -- focus on the BlackRock Credit Allocation Income Trust (NYSE:BTZ) for corporate and other bonds trading at a discount to net asset value by 8.6% and yielding 5.9%. Investors should also focus on the Nuveen Municipal Credit Income Fund (NYSE:NZF) trading at a discount of 3.8% to net asset value and yielding a tax-equivalent yield of roughly 7.5%.The yield curve isn't a threat -- but simply a measure of market activities and developments as well as an indicator of expectations going forward. It is a tool for investors which should be used and not just feared.Now that I've presented my way to invest with an inverted yield curve, you might like to see more of my market research and recommendations. For more -- look at my Profitable Investing. Click here to learn more.In addition, if you find yourself in San Francisco Aug. 15-17, please join me at the MoneyShow. There I'll be presenting my economic and market analysis and my latest investment themes and recommendations.Neil George is the editor of Profitable Investing and does not hold any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 15 Growth Stocks to Buy for the Long Haul * 5 More Cloud Stocks With Plenty of Potential * 5 Clean Energy ETFs to Buy for 2019 The post What an Inverted Yield Curve Means (And What It Doesnat) appeared first on InvestorPlace.
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.