The World’s Best Dividend Portfolio

In June 2011 I invested my money equally in a selection of 10 high-yield dividend stocks. With a year of success behind me, in July 2012, I added even more money to the portfolio. Those names offer triple the yield of the average S&P 500 stock. You can read all the details here. Now let's check out the results so far.


Cost Basis



Total Value








Exelon (NYSE: EXC  )






National Grid (NYSE: NGG  )






Philip Morris International (NYSE: PM  )






Annaly Capital (NYSE: NLY  )






Frontier Communications (NASDAQ: FTR  )






Plum Creek Timber






Brookfield Infrastructure Partners
























Retail Opportunity Investments






Annaly Preferred C










Dividends Receivable




Original Investment




Total Portfolio




Investment in SPY
(including dividends)



Relative Performance
(percentage points)



Source: S&P Capital IQ.

Our portfolio was up a bit for the week, moving from 8.2% to 8.3%. The S&P did the same, leaving us down 0.7 percentage points. We're down a bit now, but the long-term track record of dividend stocks speaks for itself, and I expect that when the new year starts and the world hasn't ended with higher tax rates, we'll see dividend stocks do well again.

Our portfolio is now yielding 6.1% -- much higher than the S&P -- while we wait for our gains. We expect this to come down, as Annaly will probably cut its dividend this quarter. We should find out officially this week with an announcement, and then the stock will go ex-dividend at the end of the month.

Fellow Fool Dan Caplinger examines whether Frontier will help you retire rich. Dan notes, "Revenue continued to drop sequentially, with continuing falls in residential customer counts and free cash flow. With the company hoping to count on promotions to woo customers, Frontier may struggle to maintain the bottom-line rise it eked out during the third quarter." I agree, and Frontier is on my list to sell from this portfolio when I think the price is right.

One stock to keep an eye on in 2013 is Philip Morris. As Fool blogger John Macris notes, the company has billions left in its buyback authorization. I'll add that the company has been aggressively buying back shares since it was spun off in 2008. Oh, and then there's that 3.9% dividend. That has made for great returns for investors, and I expect them to continue over the years.

Exelon is on dividend watch now. The company announced that it might cut its payout in order to maintain its credit rating. The stock tumbled on the news. I'm waiting to buy to see what the carnage looks like. Often these situations still have downside until the company announces the actual cut, and only then can they move up, after other investors have sold and moved on.

Dividends and earnings announcements
Here is the recent news on earnings and dividends: 

  • Exelon went ex-dividend Nov. 13 and paid out $0.525 per share on Dec. 10.
  • Vodafone went ex-dividend on Nov. 20 and pays out $0.519 per share on Feb. 6.
  • Brookfield Infrastructure went ex-dividend on Nov. 28 and pays out $0.375 per share on Dec. 31.
  • National Grid went ex-dividend on Nov. 28 and pays out nearly $1.15 per share on Jan. 16.
  • Annaly Series C went ex-dividend on Nov. 29 and pays out almost $0.48 per share on Dec. 31.
  • Frontier went ex-dividend on Dec. 5 and pays out $0.10 per share on Dec. 31.

All that, of course, means more money coming into our pockets.

It's fun to sit back and get paid, and with the market volatility, we might have a good chance to reinvest those dividends at good prices. Europe continues to be an absolute mess, and continued bad news will likely have stocks plunging again, and if they do, I'll be inclined to pick up more shares.

Foolish bottom line
I've been a fan of big dividends for a while, and I think this portfolio will outperform the market over time through the power of dividends. As I promised in the original article, I'll continue to track and report on the portfolio's progress, including news on these companies.

If you'd like to learn more about Philip Morris and its dividend, including whether Philip Morris is still a buy, check out The Motley Fool's premium research report on the company, which includes in-depth analysis of its opportunities and the challenges ahead. To claim your report, along with a year's worth of analyst updates as key news develops, just click here now.

Read/Post Comments (3) | Recommend This Article (12)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On December 19, 2012, at 10:19 AM, Matthewuwf wrote:

    Thanks Jim-

    This is one of my favorite Fool reads. Keep it up!

  • Report this Comment On December 20, 2012, at 7:37 AM, stockdoc00 wrote:

    I too am a big fan of dividend investing so thanks for the ideas.

    I'm a little surprised though that you don't have any health care stocks in your portfolio. I've found them to be a great choice for solid, safe dividend yields with steady payout growth and share appreciation. Some that I like a lot are BMY, PFE and ABT.

  • Report this Comment On December 21, 2012, at 8:30 AM, bird77 wrote:

    Have you looked at these companies' pension obligations to see if they're underfunded? That could require them to cut divs in the future. Thanks.

Add your comment.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2160382, ~/Articles/ArticleHandler.aspx, 10/23/2016 4:03:44 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 1 day ago Sponsored by:
DOW 18,145.71 -16.64 -0.09%
S&P 500 2,141.16 -0.18 -0.01%
NASD 5,257.40 15.57 0.30%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/21/2016 4:00 PM
EXC $32.50 Down -0.34 -1.04%
Exelon CAPS Rating: ****
FTR $4.07 Down -0.02 -0.49%
Frontier Communica… CAPS Rating: ***
NGG $65.36 Down -0.05 -0.08%
National Grid CAPS Rating: ****
NLY $10.08 Down -0.05 -0.49%
Annaly Capital Man… CAPS Rating: ****
PM $96.31 Up +0.74 +0.77%
Philip Morris Inte… CAPS Rating: ****