Run to high yields!!!

With the Dow down 20% since its high last October, people are hard pressed to find some place to hide and ride out the brutal bear market. The usual places people go during a recession aren't working this time around. Places like healthcare and staples for example. Those who flocked to United Health saw a swift drop from a high of 85 down to 37 in six months. Coca Cola is usually recession proof if it weren't for its decline from 65 to 50 in the same six months time.

This recession is different.

So what do you do? Find the high paying dividend stocks preferrably in the energy sector because energy and metals/mining are the only thing working. And there are several to choose from. I'm talking yields of 10% or more. High yields shield you from drops in stock price and gives you more cushion. If you have a stock that has dropped 5% in value from what you bought it for but pays a 12% dividend, you're still ahead 7% which is a lot better than being down 20% like the DOW average for the last nine months.

Here's my picks that pay a nice hefty dividend and that have done well the last few months:

1. Frontline
Frontline is an oil/ore/coal tanker company. I purchased my first set of shares when it was trading around $47. I've added to it over the last couple of months. Frontline pays an awesome dividend of 18%! Some of the shares I purchased are actually down 6% right now but with an 18% cushion, I'm still WAY ahead of the curve.

2. Hugoton Royalty Trust
I mentioned this one in a previous entry. HGT pays around a 12% dividend. The big plus with HGT is that it pays out monthly instead of quarterly. I actually purchased some more shares this week right before the ex-dividend date to get the payout. It basically averages to $15 for every 50 shares you own. It's had a big drop in value this last week when energy stocks got hammered but over all, it's a great yield which pays way better than any savings account! Who WOULDN'T want an extra $30 - $100 per month which is over and above any increase in stock price?

3. Linn Energy
Linn ( LINE ) pays a little over 11% a year for its dividend. It doesn't have huge swings in stock price and trades pretty flat but the guaranteed 11% makes it a pretty safe choice to stash some money and ride out the market.

4. Nordic American Tanker
Nordic is an oil tanker company that pays out almost 13% annually for its yield. Again, not a huge overall mover but a great place to stick some money and make a great dividend.


Over the last few months, I've been buying and selling mostly in these securities. If they hit a high, I sell off some. If they pull back, I use what I sold to buy them back. So far, it's worked well and why mess with a good thing?