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Overlooked Names Still Provide Great Returns


The list includes Target, AT&T, Costco, and Gilead.

MINYANVILLE ORIGINAL has provided a hypothetical dividend portfolio based on the company's proprietary algorithm. The portfolio lists the strongest rated Strong Buys (5 Rating) names. Each name is equally weighted. Some names in the portfolio are widely held, but often over looked, such as Target (TGT), AT&T (T), Costco (COST), and Gilead (GILD).

For those new to investing, looking at standard risk metrics on a portfolio level can be very beneficial to reduce your portfolio's volatility and help reduce large drawdowns.

Since this portfolio is comprised of S&P 500 (^GSPC) dividend stocks, the portfolio's beta is only .45. A portfolio with a beta of .45 indicates that the portfolio will move less than the market. If the S&P 500 were to be down on a given day -1%, this model portfolio would be down only -.45%. Investors looking to create a longer term portfolio should beware of this simple but powerful metric to control downside volatility.

Since August 8, 2011 for the full 12 months would have generated 44.25% return versus 24.45% return from the S&P over the same period. Remember though, past performance is not a good indicator of future results. Historically low bond yields have made investors jump into high yielding equities and have been a factor in these names' performances.

As you can see from the Exp Return, this portfolio is expected to generate less than the S&P 500. This would be attributed to the construction of a portfolio with low beta names which historically generate less return but are considered safer.

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No positions in stocks mentioned.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

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