Basket of Income
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]
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.
Discount to Phil's Stock World available here. - Ilene