Scott's Investments'  Instablog

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I have partnered with Zacks Investment Research to start providing some additional screens to my readers. So, using the stock screener in Zacks Premium service, I've screened for stocks with at least 3% dividend yield, a 5 Year Historical Dividend Growth % of 5% or greater,  and also having the highest rating from Zacks, a 1. (Zacks ranks stocks on a scale of 1-5, with 1 being a 'strong buy' and 5 being 'strong sell'; the Zacks #1 Rank List has generated an annual average return of 27% since 1988.)

One idea I had was to only purchase the stocks if the underlying index (S&P 500) was trading above a long term moving average such as the 200 day moving average. This could potentially reduce some upside gains, but could also reduce drawdowns, such as happened in 2008.  I discuss these moving averages on my blog, Scott's Investments, and they are greatly inspired by the work of Mebane Faber, author of The Ivy Portfolio: How to Invest Like the Top Endowments and Avoid Bear Markets .  In addition, one could overweight stocks in sectors that have the strongest momentum, or only purchase stocks in the strongest sectors (such as the list compiled here, which I update monthly).

The list only yields 11 results. If you were to remove the Zacks 1 rated criteria, it would yield 524 results: