- European Blue Chip Equity Portfolio with High Dividends
- Over 6.5% in Cash Generation Alone
We are thrilled to introduce the latest addition to Durig’s portfolio of investment solutions, the Dogs of Europe. Designed to capture the high quality dividends of European Blue Chips with the potential to grow income over time, this new portfolio strategy allows investors to participate in European equity trends with the help and support of a registered investment advisor in the United States.
A One of a Kind Portfolio
Durig’s Dogs of Europe Portfolio is a unique adaptation of Michael B. O’ Higgins’ “Dogs of the Dow Strategy” for beating the Dow Jones Industrial Average (DJIA) that has been reworked to target the dividends of high yielding blue chip stocks* (the actual securities held in the portfolio are American Depository Receipts and trade just like stocks) in European Markets rather than the Dow, and is believed to be the first portfolio of its kind.
A recent article by CNBC calls for international equities to outperform US equities in 2020:
“Having underperformed for more than ten years, non-US stocks are set to gain the upper hand over their US peers,” Peter Berezin, chief global strategist at BCA Research, said in a note. “A reacceleration in global growth, a weaker US dollar, and favorable valuations should all support non-US stocks next year.”
What Are “Dogs” ?
The core idea in this strategy is that high dividend yields stem from share price declines. As the business cycle goes through its natural ups and downs, the stocks with the highest yields are more likely to increase their share price over the following 12-month period. In addition, many of the companies have declared dividend payouts and these payouts are generally less volatile than share prices. Therefore, substantial share price declines will be a main driver of significant increases in dividend yields.
The “Dogs” are simply blue chip stocks whose share price has declined, and as such, the dividend yield increases, giving the stock price “more room to run”.
The Dogs of Europe target the highest yielding blue chip stocks (with respect to their dividends) listed on various European Exchanges to produce very high levels of dividend income.
With an average dividend yield of over 6.5%, the Dogs of Europe are shaping up to be the income solution that many investors have been searching for. In addition, regular dividend payments can help to cushion interim stock price declines.
Income. Everyone needs it. We all want more of it. Find a higher income with the Dogs of Europe.
“With higher dividend yields than U.S. stocks, foreign shares are a good source of income. Ample yields reflect the outperformance of U.S. equities in the past decade and the emphasis overseas on dividends, rather than on stock buybacks. If the dollar weakens and international markets finally best the S&P 500 index, the sector could be a big winner.”
Growth Over Time
Many portfolios claim to produce growth or income, but not many are truly designed to produce both income and growth of income over time.
Durig’s Dogs of Europe Portfolio was designed for both income generation and income growth over time.
The portfolio produces over 6.5% cash generation from dividends alone, and the low price of the blue chips relative to their dividend yield allows the potential for significant appreciation of the stock price, helping to boost total return.
The potential benefit for growth over time becomes much more pronounced if these high levels of dividend income are reinvested over time, helping to compound the growth benefit.
Not only are Durig’s Dogs of Europe are an excellent source of income generation, they also offer benefits in the realm of diversification when combined with other U.S. or domestic investments, as the investments in various European markets held in the portfolio help to offset the movements of your existing US investments.
What better way to diversify than by spreading your investment risk across nations?
The diversification of the Dogs of Europe Portfolio is much more significant when added to a fixed income portfolio like Durig’s Fixed Income 2 (FX2) Managed Income Portfolio. The reason for this is due to fixed income (bonds) and stocks being non-correlated asset types. This means that when combined, they work in tandem to smooth out the ups and downs of investing, making for a much smoother and enjoyable ride for investors.
The Dogs of Europe Portfolio is Durig’s latest addition to its collection of income solutions, and with an average dividend yield of over 6.5%, is shaping up to quite the income generating machine. The portfolio also has strong potential to produce growth of income over time, as dividends are reinvested and compounded over the years. The foreign blue chip dividend stocks held in the portfolio can help to improve diversification, especially when combined with fixed income investments such as Durig’s FX2 Portfolio.
For income investors that wish to increase their income, improve diversification, and seek higher yields than can be found domestically, Durig’s Dogs of Europe Portfolio is an excellent low-cost solution with professional management and a support team dedicated to helping you reach your income goals.
For More Information
Durig Capital has several high yield portfolios available, click below to learn more.
Durig Capital provides investors with a specialized, transparent fiduciary service at a very low cost. Our FX2 (Discretionary Management) Portfolio over time has greatly outperformed our FX1 (Non-discretionary) Portfolio, giving significantly higher (at times double) the returns of FX1. Our professional service enables access to a broad spectrum of bond, high yields, and lower price points that are often found in less efficient markets, but not evidenced in many bond services.
Most of our client accounts are custodied in their own name at TD Ameritrade Institutional, a large discount service provider that is SPIC insured, or at Interactive Brokers. We have now started offering our highly successful FX2 service to clients of other Registered Investment Advisors through segregated accounts at TD Ameritrade. Please ask us to learn how this might work for you and your current advisor.
We track thousands of bond issues and their underlying fundamentals for months, sometimes years, before finding any that achieve or surpass the targeted criteria we have found to be successful. Our main priority is to provide the best opportunities for our clients. Our bond reviews are first distributed to our clients, then published on our website and our free email newsletter, and lastly on the Internet and distributed to thousands of prospective clients and competitive firms. Bond selections may not be published if they have very limited availability or liquidity, or viewed as not being in the best interests of our clients. When high yielding bonds with improving fundamentals are acquired at lower costs, Durig Capital believes that investors will appreciate earning higher incomes with our superior high income, low cost, fiduciary services.
Disclosure: Performance is reported net of fee, as of 1-22-2020.
Risk Disclaimer: Any content on this review should not be relied upon as advice or construed as providing recommendations of any kind. It is your responsibility to confirm and decide which trades investments to make. Invest with only with risk capital; that is, with money that, if lost, will not adversely impact your lifestyle and your ability to meet your financial obligations. Past results are no indication of future performance. In no event should the content of this correspondence be construed as an express or implied promise or guarantee.
Durig Capital is not responsible for any losses incurred as a result of this article Information provided in this correspondence is intended solely for informational purposes and is obtained from sources believed to be reliable. Information is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted.