38 Dividend Securities for Well-Rounded Asset Allocation

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 |  Includes: ABT, ADP, AFL, BIV, BLV, BP, BSV, CAH, CB, CHRW, CLX, CTL, CVX, DBD, ED, EMR, ESS, EXPD, FRT, GPC, HGIC, JNJ, KO, LLTC, LLY, MCD, MGEE, MMM, NUE, OFC, PG, RAVN, SPGI, SYY, T, TEG, VIVO, XOM
by: Dividends4Life

I am a firm believer that asset allocation plays a significant part in a portfolio’s long-term results. Recently, I received a question asking if you could have a diversified portfolio of dividend stocks. It is an interesting question that deserves further examination.

As for my portfolio, I consider asset allocation only when looking at my holdings in total. It would be much too difficult to maintain a good allocation within individual portfolios (income, growth, 401(k), Roth IRA, etc.), while trying to maintain my overall allocation. However, an investor could build a degree of allocation into a portfolio of dividend income securities. Consider the following:

Business Services Sector

  • Automatic Data Processing Inc. (NASDAQ:ADP)
    Yield: 3.33% | Style: Large Growth
  • C H Robinson Worldwide Inc. (NASDAQ:CHRW)
    Yield: 1.86% | Style: Large Growth
  • Expeditors International of Washington Inc. (NASDAQ:EXPD)
    Yield: 1.16% | Style: Mid Growth

Consumer Goods Sector

  • Clorox Company (NYSE:CLX)
    Yield: 3.23% | Style: Mid Core
  • Coca-Cola Company (NYSE:KO)
    Yield: 3.04% | Style: Large Growth
  • Procter & Gamble Company (NYSE:PG)
    Yield: 2.85% | Style: Large Core

Consumer Services Sector

  • Genuine Parts Company (NYSE:GPC)
    Yield: 4.19% | Style: Mid Value
  • Sysco Corporation (NYSE:SYY)
    Yield: 3.56% | Style: Large Core
  • McDonald’s Corporation (NYSE:MCD)
    Yield: 3.22% | Style: Large Core

Energy Sector

  • BP Plc ADR (NYSE:BP)
    Yield: 6.15% | Style: Large Value
  • Chevron Corporation (NYSE:CVX)
    Yield: 3.75% | Style: Large Value
  • ExxonMobil Corporation (NYSE:XOM)
    Yield: 2.56% | Style: Large Value

Financial Services Sector

  • Harleysville Group Inc. (NASDAQ:HGIC)
    Yield: 3.90% | Style: Small Value
  • Chubb Corporation (NYSE:CB)
    Yield: 2.85% | Style: Large Value
  • Aflac Inc. (NYSE:AFL)
    Yield: 2.38% | Style: Large Core

Hardware Sector

  • Diebold Incorporated (NYSE:DBD)
    Yield: 3.67% | Style: Small Value
  • Linear Technology (NASDAQ:LLTC)
    Yield: 3.23% | Style: Mid Core
  • Raven Industries Inc. (NASDAQ:RAVN)
    Yield: 1.90% | Style: Small Growth

Health Care Sector

  • Meridian Bioscience Inc. (NASDAQ:VIVO)
    Yield: 3.27% | Style: Small Growth
  • Johnson & Johnson (NYSE:JNJ)
    Yield: 3.08% | Style: Large Core
  • Cardinal Health Inc. (NYSE:CAH)
    Yield: 2.10% | Style: Large Core

Industrial Materials Sector

  • Nucor Corp. (NYSE:NUE)
    Yield: 3.40% | Style: Large Core
  • Emerson Electric Co. (NYSE:EMR)
    Yield: 2.90% | Style: Large Core
  • 3M Company (NYSE:MMM)
    Yield: 2.58% | Style: Large Core

Media Sector

  • McGraw-Hill Companies Inc. (MHP)
    Yield: 2.63% | Style: Large Core

Pharmaceuticals Sector

  • Eli Lilly & Company (NYSE:LLY)
    Yield: 5.77% | Style: Large Value
  • Abbott Laboratories (NYSE:ABT)
    Yield: 2.97% | Style: Large Growth

Real Estate Sector

  • Essex Property Trust (NYSE:ESS)
    Yield: 5.14% | Style: Mid Core
  • Corporate Office Properties Trust Inc. (NYSE:OFC)
    Yield: 4.29% | Style: Mid Core
  • Federal Realty Investment Trust (NYSE:FRT)
    Yield: 4.06% | Style: Mid Core

Telecommunications Sector

  • CenturyLink Inc. (NYSE:CTL)
    Yield: 8.10% | Style: Large Value
  • AT&T Inc. (NYSE:T)
    Yield: 6.54% | Style: Large Value

Utilities Sector

  • Integrys Energy Group Inc. (NYSE:TEG)
    Yield: 6.61% | Style: Mid Value
  • Consolidated Edison Company (NYSE:ED)
    Yield: 5.59% | Style: Large Value
  • MGE Energy Inc. (NASDAQ:MGEE)
    Yield: 4.45% | Style: Small Core

Bonds

  • Vanguard Short-Term Bond ETF (NYSEARCA:BSV)
    Yield: 2.74% | Style: Short-Term Bond
  • Vanguard Intermediate-Term Bond ETF (NYSEARCA:BIV)
    Yield: 4.32% | Style: Intermediate-Term Bond
  • Vanguard Long-Term Bond ETF (NYSEARCA:BLV)
    Yield: 5.16% | Style: Long-Term Bond

Needless to say, the above will not provide a perfect allocation, but it goes a long way to provide diversity in a portfolio focused only on income securities. In my personal portfolio, I buy the best available dividend securities and use my other investments to balance my asset allocation.

Disclosure: Long ABT, ADP, AFL, BIV, BLV, BP, CLX, CTL, CVX, ED, EMR, GPC, HGIC, JNJ, KO, LLY, MCD, MMM, NUE, PG, SYY, T, TEG. See a list of all my income holdings here.

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