It may seem tough, but it is possible to find stocks with both high yields and strong growth prospects, says James Wong, portfolio manager for the

Payden Value Leaders fund

(PYVLX) - Get Report

. For example, in the energy space, Wong says natural gas and oil pipeline player

Enbridge Energy


fits the bill quite nicely.

"It has a yield of about 7% and it has consistently increased its dividend over the past 20 years. The company is a nice cash cow and that's hard to beat in this environment," says Wong.

The $77.5 million fund, which garners 3 stars from


(MORN) - Get Report

, is up more than 16% over the past 12 months, putting it in the top 1% of Morningstar's large value category. Over the past 3 years, the fund has returned an average of 21% annually, outpacing 87% of its Morningstar rivals.

In the utility space, last year's big winner in the market, Wong is a fan of the

Southern Company

(SO) - Get Report

, which has about 4.5 million customers in the Southeast and pays a dividend of approximately 4.5%.

"You have a growth rate of about 4% which is quite good. And since it is a regulated utility their revenues and their profits are pretty stable and they can pass along price increases to their end users," says Wong.

And while more and more people in the United States are cutting back on smoking, due to higher prices, taxes and health concerns, Wong does not see

Philip Morris

(PM) - Get Report



(MO) - Get Report

significantly slashing their dividends, 4.7% and 5.7% respectively, any time soon.

"There are fewer smokers in the US, that's true. But if you go abroad, especially in the emerging markets, there are plenty of people smoking. Philip Morris and Altria have the biggest brands out there. The international and domestic plays are both attractive," says Wong.

Finally, though the Iraq War is over and some investors are concerned about the impact of budget cuts on defense stocks, Wong still has faith in

Lockheed Martin

(LMT) - Get Report

. He says other countries are still buying weapons even while the Pentagon is not, furthermore, he believes the company has servicing agreements that will provide steady income.

"They just upped their dividend last quarter. And if you are looking at the political situation, if Mitt Romney wins, they are probably going to increase defense spending again. And if Obama wins, he doesn't want to be seen as a weak president going into this election, so we probably won't see that many cuts going forward," says Wong.

Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.