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A Small and Hardy Utility

Utilities often provide investors with both a margin of safety and the chance to build income over time through stable, predictable dividend increases. For investors concerned with achieving a growing stream of income - utilities are often very popular. However, in the current economic environment where investors are receiving low, no or even negative total returns by investing in government treasuries - there is a risk of the asset class becoming "too popular."

As many investors have invested in common shares in utilities as a proxy for a "super safe" investment, the increased demand for the asset both drives up the price and drives down yields - making conventional wisdom increasingly suspect and thus increasing...

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