A Preferred Share Primer

When I talk about dividend stocks here at Money and Markets, I almost always mean common shares of a company.

But today I want to tell you about another class of stock that some income investors gravitate toward: “Preferred” shares.

As the name suggests, preferred stock gives its owner a leg up on common shareholders, especially when it comes to dividends.

Preferred shareholders may receive larger payments, and companies are required to pay these dividends before distributions are made to common shareholders.

This DOES NOT mean the dividend is guaranteed. It simply means that when it comes down to the wire,…

What to Make of Corporate Bonds Now

As I’ve made clear plenty of times before … I consider solid dividend-paying stocks to be the best long-term income investments on the planet.

But I also keep a watchful eye on other asset classes, including the various flavors of bonds.

That’s because bonds both compete with dividend stocks for investment dollars and can also afford an income portfolio with healthy diversification.

If you’re a Dividend Superstars subscriber, you know that I often talk about bonds in your monthly issues. But the last time I mentioned them here in Money and Markets, was back in May.

My conclusion then: I said it looked like a…

Even Warren Buffett Is Now Saying Bonds Could Crack!

I’ve made no secret about my view on U.S. bonds and the U.S. dollar …

I’ve minced no words, and cut no corners …

Instead, I have given you specific, consistent guidance on those fronts: Namely stay the heck away from long-term Treasuries and hedge yourself against the government’s unofficial policy of trashing the greenback.

It started last year in my December 5 Money and Markets column, when I issued the most strident warning I’ve EVER released on bond prices. I labeled long-term Treasuries “the biggest bubble of all” and warned you that …

“No government, or central bank, is bigger than the bond and…

The Real Secret to Global Dividend Investing

If you want a stable dividend, focus on global companies.

Dividends still matter. But you have to know where to look.

A record setting 367 companies reduced their dividends during the second quarter, no doubt leading many shell-shocked investors to conclude that income is dead.

But there’s more to this story. A total of 283 companies actually said that they boosted their payouts, and an even-larger group of companies maintained their current dividend payouts, Standard & Poor’s Inc. reported.

Not surprisingly, each of the two groups of companies featured some defining characteristics. The companies that had cut their dividends were largely domestic in nature,…

A Safe Way to Build Wealth in the New Normal Economy

Is your portfolio prepared for the “new normal” economy?

In May, Mohammed El-Erian issued a fairly gloomy forecast for the world economy.

The CEO and Co-CIO of PIMCO, a firm which manages $700 billion in assets, said the world economy has entered a “new normal” state.

He predicted, “For the next 3–5 years, we expect a world of muted growth, in the context of a continuing shift away from the [United States, Japan, and Germany] and toward the systemically important emerging economies, led by China.

That’s pretty much in line with what we’ve been expecting. We’re looking at GDP growth of 1%…