The Dividend Investor's Guide

By Norman Roberts

A majority of dividend investors are conservative by nature. I am. I have no special trading talent, no crystal ball, nor do I have access to insider information. Therefore, I have little expectation of prospering by consistently buying low and selling high. In fact, my trading history boasted the opposite, buying high and selling low. Sadly, I realized I had invested with no real rhyme or reason, often relying on the advice of friends, brokers, and CNBC pundits, which, more often than not, failed me. I decided that if I were to continue investing in the market, I needed an investment strategy that was anchored by some logical parameter I could count on. After immersing myself in all aspects of dividend investing I found that elusive anchor, which after many fits and starts I developed into an effective long-term investment philosophy; and a variety of short-term trading strategies designed to increase my dividend yield and income. Because I have profited handsomely during this most difficult and challenging three year market, 2008 - 2011, I have chronicled the search, education and knowledge I have gained along the way, which I want to share with you in The Dividend Investor's Guide.

• Language: English
• Publisher: Norman Roberts
• Release date: Oct 1, 2011
• ISBN: 9781465732774

Norman Roberts

Dr. Norman Roberts is a retired dentist living in Ft. Lauderdale, FL. He is an avid reader, a former editor of New Scene Magazine, and author of The Blackjacks. A successful mortgage lender until the 2007 real estate crash, Dr. Roberts returned to investing in the market in August, 2008; and by March, 2009 had suffered an unrealized loss of $650,000. Although he claims no special investing expertise, luck, or insider knowledge, he developed a trading philosophy and trading strategies that converted that loss to a $600,000 gain by March of the following year, a remarkable $1.25 million turn-around. Knowledge he has since shared with friends and family, several of who urged that he write about it and share his knowledge with others. Consequently, he wrote and published The Dividend Investor's Guide in 2011. On March 2, 2016, Dr. Roberts wrote his first article as a Seeking Alpha contributor, exposing what he considered a legal attempt at extortion. He soon became a prolific, although mildly controversial contributor, and rapidly built a large base of followers and soon became the #1 contributor in Seeking Alpha's Dividend Strategy category. Based on his expertise and experience as a cumulative preferred dividend investor and the many articles he has since written on the subject, Dr. Roberts has recently published The Art & Science of Preferred Dividend Investing.

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THE DIVIDEND INVESTOR'S GUIDE

By Norman Roberts

Published by Norman Roberts at Smashwords

Copyright 2017 by Norman Roberts

TABLE OF CONTENTS

Preface

Introduction

How I Became a Dividend Investor

The Nuts & Bolts of Dividend Investing

Preferred or Fixed Income Securities

Municipal Bond Funds

Common Stocks in High Dividend Yield Sectors

Dividend Capture Strategy

Double Down Trading Strategy

Short Selling

Dividend Play Strategy

Options

Politics the Global Economy and the Market

Portfolio Protection During a Bear Market

Lessons Learned and Pitfalls to Avoid

Preferreds You Might Consider Making As An Investment

PREFACE

I suspect that most dividend investors are conservative by nature. I am. I don't believe I have any special talent or gift for trading, a crystal ball, or any access to insider information. Consequently, I have little expectation of prospering by consistently buying low and selling high. In fact, prior to becoming a dividend investor, my trading history boasted the opposite, buying high and selling low. Tis sad but true, over those years, I've given more to the market than I've taken from it. However, that's yesterday's news, and of no real interest. Of importance is that I'm patient, analytical, organized, pretty good at math, and always looking for that angle, strategy, or edge to help guarantee my market success. This book details my history, education and growth as a dividend investor and the lessons I learned along the way. More importantly, I want to share that knowledge by introducing you to an effective, yet relatively safe overall investing philosophy, along with several variably effective trading strategies, I perfected, that are designed to enhance your portfolio's income and dividend yield.

INTRODUCTION

This book is designed to give the reader a deep understanding and thorough working knowledge of dividend investing related to both common and preferred equities. However, the most valuable part of this guide concerns a detailed study of a number of short and mid-term x-date related trading strategies I developed and designed to enhance your profits and marginally increase your yearly dividend income; the majority of which are primarily concerned with the trading of common equities.

HOW I BECAME A DIVIDEND INVESTOR

Dividend or income investing is a strategy by which the investor hopes to increase the value of his portfolio primarily through the receipt of dividends rather than through stock price appreciation. I belong to this school of thought, preferring this method of investing primarily because I claim no investment crystal ball nor special wealth of investing expertise or knowledge. Consequently, prior to becoming a dividend investor, I had no effective strategy to anchor my investment decisions, which at best, were arrived at haphazardly and usually without much careful or well-reasoned thought. The result, I had left the market after the dot.com bubble wiped me out. My second losing experience as a trader. Twice bitten, I vowed never to return. And I kept that vow for eight years until a friend introduced me to the concept of dividend investing. After a lengthy conversation, I believed that I had finally found that elusive anchor on which to base all my future trading decisions. Enough so, that after a month's careful study, I was prepared to return to the market; however, this time I believed that I had the knowledge to succeed. I would invest in the market as if I was a lender; consequently, investing almost exclusively in dividend paying stocks and treating those dividends as if they were earned interest. I began by googling for dividend paying companies and discovered the Dividend Detective web site, specifically, its list of the top 100 (today the list includes 800 stocks) dividend yielding stocks.

Dividend Detective

From that list, I eliminated all stocks whose dividend yield was less than 10% or greater than 20%, which I felt were too risky. Then, after researching those selections to the best of my limited abilities, I began by buying REITs (discussed at length later) primarily invested in the hospitality, malls, office buildings, medical facilities, and industrial parks. I also invested in Closed-end funds (CEF's), Business Development Companies (BDC's), and some oil industry Master Limited Partnerships (MLP's). At the time, I naively believed that even if my expanding portfolio's overall market price dropped, I would still be collecting those healthy dividends and when the market recovered I would end up way ahead of the game. To my chagrin, during the 2008 market collapse, those promised dividends were, for the most part, severely reduced or suspended. By that time, March, 2009, the value of my portfolio