This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Dicker: Many Happy Returns?

But here's where Gross (and British investor Jeremy Grantham for another) might be right: The continuing returns of stocks that we have enjoyed for the past two years may have just about run out.

Two years ago the spread between the yields of stocks and bonds was almost three times what it is now, with little more that the Fed can do to pressure Treasury yields down further.

In the next several years, I think the master at Pimco will be right -- returns on stocks will not be the "historic" average of 6.6% often quoted by Siegel and others; it will be far less and not particularly impressive, especially for investors who need yield to retire and live on.

Now is the time to start looking over your portfolio and find assets that can continue to provide yield, even if their prospects for growth aren't their deepest calling card.

While I want to get investors thinking about other investments than traditional "growth" stocks for the next several years, I'm not about to give ultimate direction on where that value might lie. It could be in farm land or other real estate, perhaps in some hedge basket of commodities or perhaps a new emerging-market fund.

I am an energy guy, so I can give you some ideas in that space. I have continued to support the idea of dividend multi-national integrated energy companies as a core holding, particularly Exxon Mobil (XOM) and Royal Dutch Shell (RDS.A), both of which are making what I consider the right long-term moves in energy and both of which have unassailable dividends and stock buyback programs.

Another place to look is energy trusts and master limited partnerships. These are more risky, but with six or more of them in a portfolio you can minimize some of that risk and still yield a comfortable 5% or more.

One secondary in the space today stands out as an opportunity -- MarkWest Energy Partners (MWE) , yielding almost 6% based upon its current stock price.

At the time of publication the author had positions in XOM, RDS.A and MWE.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.
2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $93.83 0.10%
FB $118.65 0.91%
GOOG $700.02 1.00%
TSLA $242.75 0.83%
YHOO $36.58 -0.06%


Chart of I:DJI
DOW 17,901.57 +127.93 0.72%
S&P 500 2,079.93 +14.63 0.71%
NASDAQ 4,813.0850 +37.7270 0.79%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs