william the wie
Gold Member
- Nov 18, 2009
- 16,667
- 2,402
- 280
Criteria of selection used on both AOL and Yahoo stock screens.
Dividend/distribution yield 10% or more initially and going as low as 8% when the portfolio grows.
Beta less than 1
Must have an active options market.
Reason for these criteria:
Since I am primarily using a tax favored account I am indifferent to whether my gains are from income or capital gains and yield tends to be a lot more predictable than appreciation. Beating the longrun average appreciation of 7.4% on just dividends gives me a minimum margin of safety of 8% and usually much more.
Low beta means both higher alpha (Y intercept) for going up when the market goes sideways as is normal when rates are edging up. It also means less of a drop when the market goes down.
Being able to buy by writing puts = either a nice rate of return or acquisition for less than I was willing to pay. Selling by writing calls also provides additional net income or a sale that frees up capital for diversification.
Other than being boring any errors spotted?
Dividend/distribution yield 10% or more initially and going as low as 8% when the portfolio grows.
Beta less than 1
Must have an active options market.
Reason for these criteria:
Since I am primarily using a tax favored account I am indifferent to whether my gains are from income or capital gains and yield tends to be a lot more predictable than appreciation. Beating the longrun average appreciation of 7.4% on just dividends gives me a minimum margin of safety of 8% and usually much more.
Low beta means both higher alpha (Y intercept) for going up when the market goes sideways as is normal when rates are edging up. It also means less of a drop when the market goes down.
Being able to buy by writing puts = either a nice rate of return or acquisition for less than I was willing to pay. Selling by writing calls also provides additional net income or a sale that frees up capital for diversification.
Other than being boring any errors spotted?
