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Suppose I told you that there was a category of investments in which you could make good money -- 4%, 5%, even more -- while the bear reigns, and even more money once things turn around.

Nope, it's not a money market fund. They're safe, mostly, but you'll be completely left out of any stock market rally.

Nope, it’s not corporate bonds. While they're an important part of many retirement portfolios -- one that has been overlooked by many of us in recent years -- they're likely to get driven down in value as money moves back into stocks.

Nope, it's not Treasuries. (Have you looked at Treasury yields lately? People are giving up an awful lot in exchange for that "full faith and credit" guarantee.)

It's stocks.

Yeah, OK, stop laughing now
That may seem like crazy advice after the stock market bloodshed of recent weeks. But stocks come in a lot of different flavors -- and not all gains and losses come from changes in share price.

Some stocks are exciting. Some stocks are boring. In good times, many of us are drawn to the exciting stocks and shun the boring ones. But right now, boring can be really good.

Take Kimberly-Clark (NYSE: KMB  ) . Here's a company that's 136 years old and makes boring, low-growth products with names like Kleenex, Huggies, and Cottonelle. About as dull as it gets, right?

Think for a minute. We're probably in for a doozy of a recession. People are going to be cutting spending left and right. But if you've ever used generic toilet paper, you understand why these brands command fantastic recession-resistant loyalty. Folks might forego the pricey steaks in favor of burgers this week, but they're not going to forego the Cottonelle in favor of that awful scratchy stuff. (But if they decide to compromise by getting the cheaper semi-scratchy Scott's brand, that's OK -- K-C owns that one, too.)

"But," I hear you saying, "the market downdraft has still hurt their share price. Odds are they'll get hurt more."

That's probably true. But meanwhile, you get dividends. At today's prices, that's a yield of about 3.7% a year -- no matter what the stock market does.

And listen up: Even if the price goes down, you don't lose money unless you sell. The best of these companies are ones you can hold in your portfolio for decades. These aren't short-term trades. Think of the current market as a bargain-hunting opportunity -- but you get paid for holding the bargain until it appreciates.

So what's worth buying?
A quick CAPS screen for four- or five-star large-cap stocks with dividend yields of 3% or more gave me 511 names, including these:


CAPS Rating (out of 5)

Current Dividend Yield

Altria (NYSE: MO  )



Barnes Group (NYSE: B  )



Diageo (NYSE: DEO  )






Newell Rubbermaid (NYSE: NWL  )



Sasol (NYSE: SSL  )



Are these the best of the lot? Maybe, maybe not. Remember, we’re not just looking for a good value; we want good long-term investments, ones that won't have to cut their dividends even if the economy's stinkage goes on for a while.

So how can we cut to the chase and find the very best buys? If you'd like to save yourself the trouble of doing due diligence on 500 stocks, I suggest taking a look at the Fool's Income Investor service. They specialize in exactly this problem -- stocks with great dividend yields that are also great long-term investments right now. You can look at their complete list of recommendations, including their best ideas for new money now, free of charge for 30 days. There's absolutely no obligation to subscribe.

Fool contributor John Rosevear has no position in any of the stocks mentioned. Kimberly Clark, Diageo, and Sasol are Motley Fool Income Investor recommendations. Sasol is also a Motley Fool Global Gains recommendation. Try any of the Fool's newsletters free for 30 days. The Motley Fool has a disclosure policy.

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Related Tickers

10/25/2016 4:02 PM
B $39.46 Up +0.11 +0.28%
Barnes Group CAPS Rating: ****
DEO $108.22 Up +0.01 +0.01%
Diageo CAPS Rating: *****
KMB $113.73 Down -0.18 -0.16%
Kimberly-Clark CAPS Rating: ****
MO $64.71 Down -0.24 -0.37%
Altria Group CAPS Rating: ****
NST.DL2 $0.00 Down +0.00 +0.00%
NSTAR CAPS Rating: ***
NWL $51.63 Down -0.85 -1.62%
Newell Brands CAPS Rating: ***
SSL $28.44 Up +0.04 +0.14%
Sasol CAPS Rating: *****