This boring income portfolio strategy can yield gains of over 300%

Most people think that you can’t time the market. This is nonsense. Not only is it possible, It’s easy.

I know, it’s a bold claim.

Today I’m going to show you how to do this with far less risk than the average investor. The best part? We don’t need to wait for the next panic to implement our plan. We can start now.

This strategy not only helps us avoid panic takes advantage of Chaos in the market for big profits (and a huge source of income). This is largely due to the plan’s “secret weapon”: dividends. or more specifically Dividend increase.

Our strategy starts with a decidedly ineffective approach—dollar-cost averaging, or DCA. But it builds from there, giving us a chance to make strong profits using one of the most reliable patterns I have seen in investing.

Step 1: Build your income portfolio automatically

Most investors shy away from DCA, but they shouldn’t, because it gives us an edge over the “buy and hope” crowd.

Under DCA, we invest a fixed amount in a stock or fund on a fixed date, such as the end of the month. By sticking to that routine, we never buy more when a stock is expensive (because our fixed amount buys fewer shares at that time). Plus we naturally buy more shares when they are cheap.

Successfully “timing” the market? check!

You’re probably well aware that all brokerages let us do this automatically with our dividends through a Dividend Reinvestment Plan or DRIP. I think of DRIPs as our favorite dividend payers that go to the gym and build their value and our income stream over time.

But it doesn’t matter whether you follow this approach with reinvested dividends or using fixed amounts of new money. The effect is the same.

Most people stay here. Not us. Because now we’re going to go ahead and “magnetize” (hint!) our dividend. one more Very few people appreciate proven patterns.

Step 2: Empower the Dividend Magnet in Your Income Portfolio

the key to In fact Our market-timing game is to work running DCA in the background, but keeping cash “on the side” to deploy into the markets. In fact Falling out of bed.

The truth is that this is easier said than done. While we all consider ourselves smart contrarians, there is a lot of trepidation in pulling the trigger on a purchase when a stock is in freefall. This is where the second part of our plan comes in, as it essentially throws a “tractor beam” at a stock, slowing its slide and pulling it back in when the dust settles.

If you’ve read my columns, you’ve probably heard me talk about the dividend magnet. A company’s dividend growth causes its share price to become higher over time. This is one of the most reliable (and least discussed!) patterns of investing.

It gives us the strongest benefits when three things are present:

1. A dividend that is not only growing but Quick.
2. A stock that has lagged behind payout growth. This is when we want to deploy our excess cash, with the belief that the increasing payout will pull the share price up again.
3. A buyback plan, which cuts the number of shares outstanding, increases earnings per share, putting upward pressure on share prices.

The best way to explain this is to show it in action. Let’s do that, with my two picks. hidden yield Dividend-growth service.

Visa’s dividends “dog walk” its share price

Visa (V) The poster child for our “DCA+” scheme, which ticks all three of the boxes above.

First, management has increased pay by 378% over the last decade, and that increase Quick (Last year’s increase was a spectacular 13.6%) as the company targets new areas like stablecoins, which make cross-border transactions faster and cheaper.

Buyback plan? check. Nineteen percent of Visa’s shares have been bought back and canceled over the past decade. The result is a dividend magnet set to “high” – and a perfect roadmap for our DCA+ play:

You can see how our strategy works with stocks like this. Using DCA, you will naturally buy fewer shares when they are expensive and more when they are cheap. He is built inside.

Now imagine injecting additional cash at each drawdown (circled above). This will increase our profits even further. and we can be confident In those purchases, knowing Visa’s Dividend Magnet Is it to throw a floor under the stocks and pull them back up.

And if you look at the right side of that chart, you can see now is the right time for us to start, with the stock again lagging well behind payouts.

Our next pick is also a great DCA+ candidate as its stock is slightly more volatile with respect to its dividend than Visa.

Amgen’s whipsawing share price always comes back on its payoff

In the last five years, Amgen (AMGN) Its share price has been seen tracking its payout higher, but with more volatility than Visa. He is alright! This gives us more opportunities to add to our regular DCA purchases. Check it out:

This is a classic. If you had just dollar-cost-averaged into Amgen, you would have done pretty well.

If you have saved some dry powder for dips? Even better! Because like Visa, Amgen’s rapidly growing payout keeps its share price from straying too far. Management buybacks also help, as the company has taken 5% of the market float in that time.

I expect payouts to continue to increase due to the benefits to pharma.AI-accelerated“Drug research, which would shave off years of development. This is likely to add billions of new sales because Amgen and its competitors will have the chance to sell their drugs for years before generics arrive.

So while Amgen’s share price is now roughly equal to its payout, it’s still a good time to get started while keeping cash aside for the next decline.

This is the best part of this strategy: we No Will have to wait for that drop. We can start now, build wealth over time, and deploy more cash when the share price falls behind payouts, confident that our dividend magnet will be there to bring it back up.

Brett Owens is Chief Investment Strategist contradictory outlook. For more great income ideas, get a free copy of their latest special report: How to live off huge monthly dividends (up to 8.2%) – practically forever.