Interest rate swings affect some income investments immensely and others less so. There’s no question, however, that what happens to the benchmark 10-year Treasury note yield will have some impact on virtually everything that pays a dividend.
Global events are increasingly central to how markets move. And while I strive to make such actions irrelevant to my readers…I’m always paying attention to the risks and potential rewards from the global markets.
With top-quality utilities and real estate investment trusts (REITs) paying out 3 percent or even less, it’s certainly become a lot more difficult to earn a decent income return in recent years–particularly if you stick to Wall Street’s beaten path.
Markets work best when the self-interest driving them is enlightened. In other words, there’s a huge difference between decisions made solely to grab a big payday and those based on sound business principles.
We demand two things from management for our money–first, that it’s always up front with us about the prospects for our investment, informing us of risks as well as profit potential. That means clear reporting of earnings, along with where strategies and goals are succeeding and where they’re struggling.
It looks to me like regulating CO2 and controlling its emissions from power plants will be the single most important environmental issue for power companies over the next decade.
Like lightening, the flu usually strikes when you least expect it. The recent Orlando Money Show was the first I’ve missed in more than 20 years. For those who went to the show to hear me, I have a number of other appearances on the calendar this year: February 17: Washington, DC, American Association of [...]
Utilities across the board are finding that dividing their operations can create interest in their stock and gains for shareholders. And deals completed to date have had considerably more plusses than minuses.
On the one hand, strong companies are putting up solid results and show every sign of continuing to do so. On the other, interest rates appear to be doing their annual thing, with the benchmark 10-year Treasury note yield pushing close to 4.9 percent in Friday’s trading.
The lesson here for investors is you can’t avoid regulatory risk entirely with utilities. And even if you completely avoid utilities, you’re still going to have regulatory risk with virtually any industry you invest in, from pharmaceuticals to Super Oil companies.
