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Ilene is an editor at Phil's Stock World, Market Shadows and other financial publications. Her educational background is in biology, pathology and law. After working in biochemistry and pathology during her graduate years, she attended Law School at Loyola. She practiced law in a number of... More
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  • Basket of Income 0 comments
    Mar 28, 2010 6:52 PM | about stocks: NLY, NZTCY, SUI
    Here's another article from Allan on income-producing stocks and his plans to trade them. - Ilene 

    Basket of Income
    Courtesy of Allan 

    Biotechnology Basket has triggered another idea, a Basket of Income Stocks that will pay a healthy dividend when the Trend Models are LONG, and yet will not share the risk of loss when the Trend Models say, "Exit, go to cash."   

    The past few days I’ve been researching high-dividend paying stocks across diversified sectors, Bonds, Utilities, Oil & Gas, REIT’s and assorted other sectors.  The concept is to put together a basket of these income generating companies that is as non-correlated as possible and where the individual stocks have historically trended well under the trend following algorithm either on the Daily and/or Weekly Models.

    The results so far are very encouraging and I expect to be trading this basket myself, especially as a conservative, low-risk strategy for the benefit of conservative, low-risk accounts.  As with the Biotechnology Basket, I’ll send it out to the email list first and eventually will post some if not all of the names here.

    This is concept in beta phase right now, so all suggestions are welcome and encouraged.  Below are some ideas along with their Weekly Trend Models.  [click on charts to enlarge]

    NLY - Yield 14.70%
      
     
    NZT - Yield 11.20%
     
     
     SUI - Yield 10.20%
     
     
     
    These are three examples of what I am looking for and will not necessarily be part of the Basket of Income. To be considered, I am looking for stable dividends and price histories that trend well.  Once in that group, I will look to diversify across uncorrelated (or at least, less correlated) sectors.

     

    The goal will be to be collect the healthy payouts along with capital gains when the model is LONG and to be in cash on the sidelines when the model is SHORT, avoiding high risk periods characterized by weak and falling prices.   The Trend Models are ideally suited for trading these kinds of stocks.

     
    Check out Allan’s site, and if you wish to subscribe, Allan is offering PSW readers a 25% discount.  Click here for the discount. 

    Discount to Phil's Stock World available here.  - Ilene 
     
    Stocks: NLY, NZTCY, SUI
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