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TheStreet Open House

How to Beat, or At Least Stay Sane, in a Volatile Stock Market

NEW YORK ( TheStreet) --I wish more people would do what TheStreet founder Jim Cramer did the other night on his "Mad Money" television program: Cut Ben Bernanke and the Federal Reserve some slack.

As Cramer said, Bernanke can only do so much. Cramer appreciates the Fed's "measured approach" and I appreciate Cramer's calm approach to the market while others wax hysterical.

"As long as I can remember, the rain been coming down. Clouds of mystery pouring confusion on the ground," as Creedence Clearwater Revival sang. The sky was falling, big time, in 1975 when I was born. And it's been falling, almost non-stop, ever since. I can hardly count the number of times Bruce Springsteen has covered Credence over the years as a sign of protest, anger and frustration. It never ends. If you have been following the stock market for any length of time, you should recognize this.

To generate market-beating or, at the very least, consistent returns and, more important, stay sane during volatile times, you need a plan in place that puts you on the offensive. At the top the list for me is to maximize income.

Buy Dividend Growth Stocks

Something Cramer said hit the nail on the head: Because of the Fed's interest rate policy, for at least the next few years ... dividend stocks as the only game in town. That's where I keep about 70% of my money.

I don't go after yield as much as I go after companies that increase dividends and continue to grow even in a sluggish economy and uncertain world. That's why I hold so many big media companies.

Not only do they keep increasing their dividend payments, but they're pumping revenue consistently higher by licensing no longer advertising-friendly content to outlets like Netflix (NFLX) and Amazon.com (AMZN). Plus, they're lapping up revenue associated with the sports programming they own the rights to as well as pay cable television and movie production and distribution. It's a wonderful business to be in -- volatile stock market or not -- and it's only going to get bigger and better.

Track my article history for coverage of the media companies I own and like.

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