Entirely too many investors lurch from one stock to another in a desperate search for higher returns. While a precious few get lucky, the majority doom themselves to abysmal returns.
Wall Street, of course, loves this, because this kind of behavior generates huge commissions and gives professional traders a self-replenishing source of fuel… your money.
Thankfully, it doesn't have to be that way.
Today we're going to talk about what you need to know about a special class of investments that's been shown to account for as much as 90% of total market returns over the last century.
They're beaten down, ideal for anyone who's been burned by the latest dot-bomber or media darling, and one of the most sensible investments you can make today.
Best of all, they pay you cold hard cash while requiring almost none of your time to manage, making them a perfect choice even if there's more volatility ahead.
Here's a time-tested way to put your investment money to work during turbulent times.
What Most Investors Are Missing in Their Rush to Profits
I've talked with tens of thousands of investors over the years and inevitably they all want the same thing… safe, big double-digit returns.
There's nothing wrong with that. It's absolutely possible. No – scratch that – it's essential to building the financial future of your dreams.
Here's the rub though…
Most investors go about this entirely the wrong way. They pursue the next "best thing" and lurch from stock to stock thinking that's going to get them the home run they desperately crave. The majority of the time they wind up with nothing to show for their efforts save smaller brokerage statements.
In reality, the path to above average double-digit returns is right in front of them. It's the sure things that make this happen.
As usual, this is counterintuitive. As always, you've got to get your emotions out of the way before you get started. That way you can take a good hard look at the data without damning emotional hang-ups.
That's what Richard Turnhill and Stuart Reeve did in 2010. The former is chief investment strategist for BlackRock's Alpha Strategies Group and the latter is the lead portfolio manager for BlackRock's Global Dividend Income portfolios. Between the two of them, they help manage more than $4.7 trillion – with a 'T!'
Their research, like mine, tells a very compelling story – up to 90% of total returns over the last century came from dividends and reinvestment. Not 25% or 50%, but 90%.
Most investors hear this and immediately make a fatal assumption that they have to play a decades-long waiting game to earn that kind of money. That's simply not true.
About the Author
Keith Fitz-Gerald has been the Chief Investment Strategist for the Money Morning team since 2007. He's a seasoned market analyst with decades of experience, and a highly accurate track record. Keith regularly travels the world in search of investment opportunities others don't yet see or understand. In addition to heading The Money Map Report, Keith runs High Velocity Profits, which aims to get in, target gains, and get out clean. In his weekly Total Wealth, Keith has broken down his 30-plus years of success into three parts: Trends, Risk Assessment, and Tactics – meaning the exact techniques for making money. Sign up is free at totalwealthresearch.com.