Tuesday, July 9, 2013

Never Chase High Yield


That’s the message in Donald Cassidy’s feature article in the current issue of AAII Journal.
“In the current artificial low-yield climate,” he warns, “risk to capital is real but is being ignored more than usual, as investors seek to replicate the income streams available pre-2007.”
His article covers MLPs (master limited partnerships), preferred stocks, utility common stocks, and REITs (real-estate investment trusts)—including tax-risk issues for REITs and MLPs.
His piece is well worth the time to read it, and I strongly suggest you do.
The Association of Individual Investors is a not-for-profit organization dedicated to being a primary resource for those of us who manage our own investment portfolios. I’ve been a member for about 40 years. In that time, it has steadily become a better and better resource fulfilling its mission.

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