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Haverford Investment CIO: It’s Time for Equities

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    Haverford Investment CIO Hank Smith on dividends, volatility and income growth.

  • Duration 3:18
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Are you hungry investor well Hank Smith have -- for its chief investment officer says.

There's no free lunch on Wall Street you've got to work for your food that he spent the last hour of trading the thoughts of a -- this -- -- -- food do you mean he'll.

We -- dividends and yes we are always hungry for dividends and the beautiful thing is you have that opportunity today as you have for the past three years all we're seeing -- today.

And yesterday the day before it is that Wall Street is climbing the wall of worry.

Tensions in Syria problems in Europe higher bond yields in Spain my goodness and get -- -- European shares are on track.

For the seventh week of gains yeah I think.

Wall Street is perhaps looking for May -- QE3.

And beyond that if you look at the external truck that really created this slow down the fiscal -- All the negative economic data started happening once the fiscal cliff became headline news in the spring every single day.

And I don't think that's going to happen and so the market to start to look through that okay you first started to look -- saying it's time to be in equities right.

Absolutely and if you're going to be in equities why not take advantage.

Of the high quality big dividend yielding companies.

Where you're getting a better than bond yield.

Okay but let's let's pull that apart.

Because what you're saying his pick stocks that happened dividend that is not only better than the ten year -- that's not such a hard target date -- -- of that one point 49% today or one point five.

But also better than the ten year bonds of the company itself.

Correct and there's opportunities and every single sector and here -- sorry we've got them that once it you -- right.

Oh it but I we selected a five pack it could have been a ten -- They're available every single sector.

These -- companies.

We dividend yields better than their own ten year debt and the beautiful thing is you also get growth of income which you don't get when you buy a bond.

But there is no free lunch and you have to give up.

Volatility you have to accept increased volatility but if you're buying stocks for the yield.

Who cares of the stock declines are still gonna get your quarterly dividend and next -- again an annual income looks like you just said.

Who cares if the doctor Clive they've been may be baby boomers do may be retirees.

Let's pick one of those on your list eaten for example ticker symbol ET and you know that is the one that has a yield of about three point 9% -- that of course it's a great -- But that stock is down about 24% over the past year.

You're willing to save.

At met I'll take it.

Well we're continuing to own eaten in fact we actually added to our position where it had a similar bear market last year and once the concerns of a double dip recession didn't materialize.

You -- return that more than made up.

All through that all bear market and we think that's going to happen this time.

And their fundamental business is still strong and they're increasing their dividend which is the most tangible evidence of the confidence management hasn't focus.

-- -- We've got Heinz Johnson & Johnson DuPont these are some of the names on this list by the way it will put them up on the FaceBook page of course.

But coming up you've got to report that you're going to pull apart explain why you really like these are gonna -- apart on one of them.

Because there's something -- -- that I thought well why would you pick this competitor.

Our I don't like it's second just a minute stay -- we've got much more.

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