Unlocking the Power of Dividend Investing
When it comes to building wealth on Wall Street, there’s no one-size-fits-all approach. With thousands of publicly traded companies and exchange-traded funds (ETFs) to choose from, finding the right strategy can be overwhelming. However, one approach has consistently stood out from the rest: investing in high-quality dividend stocks.
The Case for Dividend Stocks
A recent study by Hartford Funds, in collaboration with Ned Davis Research, compared the performance of dividend stocks to non-payers over a 50-year period. The results were striking: dividend stocks averaged an annual return of 9.17% and were 6% less volatile than the benchmark S&P 500. Meanwhile, non-payers generated a modest 4.27% average annual return and were 18% more volatile than the S&P 500.
The Risk-Reward Tradeoff
While high-yielding stocks can be enticing, they often come with increased risk. However, some ultra-high-yielding stocks are doling out their payments on a monthly basis, providing a steady stream of income for investors. But how can you separate the wheat from the chaff?
Three Ultra-High-Yield Stocks to Consider
If you’re looking to generate $200 in super-safe monthly dividend income in 2025, consider investing in the following three ultra-high-yield stocks:
1. Realty Income (NYSE: O)
Realty Income is a premier retail real estate investment trust (REIT) with a yield of 6% and a track record of increasing its payout for 109 consecutive quarters. Its top-notch commercial real estate portfolio, diversified by client and geography, ensures highly predictable funds from operations (FFO). With a weighted average lease length of 9.4 years, Realty Income’s FFO is incredibly safe.
2. PennantPark Floating Rate Capital (NYSE: PFLT)
PennantPark Floating Rate Capital is a business development company (BDC) with a yield that has consistently hovered between 8% and 12% over the last decade. Its debt-driven portfolio, with a weighted average yield on debt investments of 11.5%, provides a high level of income. Additionally, 100% of its loan portfolio sports variable rates, allowing it to take advantage of rising interest rates.
3. AGNC Investment (NASDAQ: AGNC)
AGNC Investment is a mortgage REIT with a yield of 15.5%. While its yield may appear too good to be true, it has spent much of the last decade hovering between 10% and 15%. As interest rates decline, AGNC’s net interest margin is poised to expand, providing a recipe for increased income.
Investing for Success
By investing $22,050 equally in these three ultra-high-yield stocks, you can generate $200 in super-safe monthly dividend income in 2025. Remember to always do your due diligence and consider your individual financial goals before investing.
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