Today IaEURtmm going to show you the one market indicator you can use to grab gains as high as 70% in nine months (or less!), plus dividends growing double-digits, too.
ItaEURtms a measure of market panic youaEURtmve probably heard about, but hereaEURtms the funny thing: everyone is looking at this indicator backwards.
Let me explain.
First, IaEURtmm talking about the CBOE S&P 500 Volatility Index, or VIX for short. YouaEURtmve probably heard of the VIX: dubbed the marketaEURtms aEURoefear gauge,aEUR itaEURtms a measure of how volatile traders see stocks in the next 30 days.
In other words, when investors are twitchy, the VIX risesaEUR"and when theyaEURtmre confident, it trends down. But to really profit off this measure of terror, you have to be a gutsy contrarian and buy when fear shoots up.
ItaEURtms one of the most reliable buy indicators there is! Take a look:
VIX Up, Stocks Up
As you can see, every time the VIX spikes, the market takes off soon after. Take a look at the end of that chart: you can see that the VIX is a bit higher than itaEURtms been for most of 2019.
That means our buy window is easing open once again.
And if history is any guide, our opportunity will soon get better. ThataEURtms because September is one of the more volatile months, according to Yardeni Research, and typically turns in the worst performance.
And with profits and sales still strong, unemployment low and wages rising, any pullback (and spike in the VIX) this month would be a great buying opportunity.
But weaEURtmre not going to settle for ho-hum dividends from darlings like McDonaldaEURtms (MCD) or Coca-Cola (KO). To ride our aEURoefear gaugeaEUR to market-beating gains, we need stocks whose dividends are not only growing but accelerating.
Last week, in aEURoe3 Dividend Stocks That Are Near-Perfect for High Volatility,aEUR I showed you how a rising dividend is a magnet, pulling a companyaEURtms share price higher as the payout grows. And the lure of a rising dividend is very strong now, with the yield on the 10-year Treasury note plunging below the yield on the typical S&P 500 stock.
To show you how potent buying a rising dividend against a spiking VIX can be, let me take you back to December 21, 2018, when the aEURoefear gaugeaEUR hit 30aEUR"the highest level in nearly five years.
That prompted me to do something unusual in my Hidden Yields advisory.
You see, Hidden Yields comes out monthly, and every issue brings you one new dividend-growth pick. But in December, with my favorite contrarian indicator going wild, I decided the time was right to pound the table on not one but two dividend-growth picks.
How Fear Drove a 70% Gain
The first was NRC Health (NRC), a low-key maker of aEURoeback-endaEUR systems for the healthcare industry, specifically surveys that solicit patient feedback on doctors, nurses and staff.
ItaEURtms a low-key firm with a smart business model: itaEURtms free for patients to use but charges thousands of dollars a year to cash-rich healthcare providers! That gave it:
- RecurringA annual payments from customers with
- Recession-proofA businesses.
I also liked the fact that NRC had plenty of room to grow by building customized systems for clients and cross-selling its other products. It nearly tripled its aEURoeregularaEUR dividend since 2014 and was kicking out regular special dividends, too:
NRCaEURtms Dividend Grows 2 Ways
How did that buy turn out? Fast-forward nine months, and NRC had soared 70%!
NRC Triples the MarketaEURtms Gain
We werenaEURtmt done.
Because with my aEURoefear gaugeaEUR still redlining back in December, I added a second dividend grower IaEURtmd been watching to our Hidden Yields stable.
That would be NexStar (NXST), a midcap stock that had been dragged down by a misunderstanding of its business: NexStar is one of the biggest local-TV operators in the country, reaching an impressive 38% of US households.
This was a classic aEURoedisrespected dividend,aEUR trading at 6.5-times earnings when I recommended it. But hereaEURtms what most folks missed:
- NexStaraEURtms retransmission revenueaEUR"the money it collects from broadcasters for the local content it providesaEUR"was growing quickly. Plus,
- Its digital-media revenue (from its 114 local websites, 202 local mobile apps and online videos) was growing even faster.
Add these channels together and you had a company growing profits, sales and dividends at an amazing clip:
We Bought This for Just 6.5X Earnings
Over the following nine months, NXST handed us a fast 31% return, easily eclipsing the market!
aEURoeFear GaugeaEUR Ignites Another Market-Beating Return
Now letaEURtms turn our attention to 7 of my very best dividend-growth picks. TheyaEURtmre perfect for the markets weaEURtmre in right now.
7 Buys to DOUBLE Your Money Every 5 Years (High VIX or Low)
I canaEURtmt wait to tell you about these off-the-radar buys, which are poised to throw off strong double-digit gainsaEUR"year in and year outaEUR"with much of that return coming your way in cash dividends!A
So what kind of upside am I talking about?
Enough to DOUBLE your money every 5 yearsaEUR"and likely less time than that!
Imagine turning a retirement aEURoepotaEUR ofA $250,000 into $500,000,A orA $500,000 into $1 million.A ThataEURtms the kind of upside IaEURtmm talking about here.
And you donaEURtmt have to wait for the VIX to spike to buy them. These 7 dividend wonders are cheap NOWaEUR"and like NexStar and NRC, theyaEURtmre growing payouts at an accelerating pace.
DonaEURtmt miss your chance to buy these 7 dividend plays before their prices race higher.A Click here and IaEURtmll give you everything I have on each one: names, tickers, buy-under prices and the double-digit dividend (and share-price) growth you can expect.