Salient to Investors: Phil Mause at Pacific Economics Group writes: Investors should buy up dividend stocks, business development companies (BDCs), REITs and other investments yielding more than bonds. A dividend stock led stock market could rise considerably – dips will be shallow as many investors will be waiting to get in.
READ MORE... →Salient to Investors: Mortgage REITs tumbled on the expectation that more homeowners would be able to prepay mortgages and because lower yields on new investments would squeeze earnings and dividends. Vitaliy Liberman at DoubleLine Capital said continuation of policies that started last year are basically assured now. Edward Mills at FBR Capital Markets said housing is a clear winner
READ MORE... →Salient to Investors: Bill Miller at Legg Mason said because housing has done so well, the next move there is in financials. Miller said an improved housing market means banks’ mortgage origination businesses will improve. Miller’s fund had 40 percent of assets in financial stocks as of Sept. 30, and
READ MORE... →Salient to Investors: Since 1926, intermediate US government bonds earned about 2.5% above inflation, stocks about 7% above inflation. Currently TIPS yield negative 0.5%. Assuming stocks continue to outperform bonds by 4.5%, then future real returns on stocks will only be 4%, and on a 60-40 balanced portfolio will only be 2.5%. Therefore, central
READ MORE... →Salient to Investors: Toru Higuchi at Japan’s Teachers’ Mutual Aid Co- operative Society will start investing in REITs and hedge funds. Japan’s has the world’s second-largest retirement pool, after the U.S., with only 6 percent in alternative assets versus 25 percent in the U.S. and 24 percent in Australia. Read the full article at
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