Wednesday, August 7, 2013

Apollo Investment Corporation (Nasdaq: AINV), Where the Smartest on Wall Street Make Their Money

Did you know there are companies that must pay out 90% of their earnings to shareholders?

They have to. By law. They can’t skimp out.

Not only that, they’ll pay you a high yield dividend. Much higher than dividend stocks or corporate bonds.

They’re not Canadian investment trusts or some exotically structured partnership where you have to worry about your money.

And get this. They’re part of private equity companies. Whether you like private equity or not, it’s where the smartest on Wall Street make their money.  (more)

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How Safe is the Swiss Franc?

by Pater Tenebrarum
Acting Man

SocGen Thinks CHF is the ‘Next Safe Haven to Fall’
The Swiss franc has become a ‘safe haven asset’ during the euro area’s debt crisis, along with a number of other peripheral European currencies, especially the Scandinavian ones. Similar to the central banks in Scandinavian countries, the Swiss National Bank (SNB) thereupon instituted a major inflationary policy, including in this particular case not only ‘ZIRP’, but also the enforcement of a floor rate versus the euro, so as to avert ‘deflation’ and ‘damage to the export industry’ – in other words, the SNB decided to risk the value of its currency as well as the formation of a major asset bubble for misguided mercantilistic reasons. Nevertheless, buyers continued to pile into the CHF (one wonders what they were thinking?), thereby ‘forcing’ the SNB to continue to defend its peg by letting the printing press run 24/7.
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The 3 Best Dividend Growth Stocks You Never Heard Of – Yet : FHCO, TAL, QSII

Cash is still king but it doesn’t hurt to add some growth to balance out long-term returns. Take advantage of the higher growth potential in smaller companies but look for ones with sustainable payouts.

How the Dividend-Growth tradeoff works

After two stock market meltdowns in less than 15 years, investors have learned that a dividend today is worth much more than the prospect for higher prices in the future. That constant cash return is worth more than just money in your pocket, it means that your total return is cushioned when the market tanks and a quarter of the stock price is wiped out.

But the allure of big money gains is still strong and even the most generous dividend payouts can’t compare to growth stories like Oracle (NYSE: ORCL) and its almost 19,000% return in the ten years to the 2000 peak.

Normally, these high-growth companies are not going to pay a dividend. They keep all cash flow for reinvestment in the company for the promise of a higher stock price. Most dividend-paying stocks, especially those with yields above 2%, are from large companies in mature markets. Growth opportunities are fewer and cash flows are more stable so the company isn’t really sacrificing as much when it pays out a dividend.  (more)

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Beat the S&P With These 3 ETFs

If there’s one sector that’s primed for explosive growth right now, it’s biotechnology.

Its position as a new market leader in the tech sector cannot be overstated. Clearly, investing in biotech is an idea few can afford to ignore.

Genentech, the first biotech company, was formed in 1973 and was the first to go public in 1980, which launched the biotech sector.

Though the sector is only 33 years old, humans have been using varying forms of biotech for thousands of years, before anyone was investing in anything.  (more)

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Chart of the Day - Tesla Motors :TSLA

You don't read much if you haven't heard of the founder Elon Musk. Tesla Motors, Inc. designs, manufactures, and sells electric vehicles and electric vehicle powertrain components. The Company is headquartered in Palo Alto, California.

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The Coming Shale Write-Downs, A sneaky trick energy companies use to deceive investors.

by Marin Katusa
Casey Research

Not all shales are equal. Some shales are deeper than others; and some are dry gas, while others are gas with liquids. In North America, billions of dollars have gone into developing all types of shale formations to extract as much natural gas, natural-gas liquids, and oil as possible. The production from shale formations has truly been a game-changer for North America, but yet, oil is still more than US$100 barrel.
How can oil be more than US$100/bbl even though the shale revolution was supposed to save us from high oil prices?
First off, shale wells are very expensive to drill and complete. Including all costs, it can cost up to US$15 million to drill, frac, and complete a deep horizontal well. Because of the success of the shale revolution in North America, natural-gas prices have decreased significantly. In fact, in many parts of North America, the natural-gas shales are uneconomic without NGLs (natural-gas liquids) as a byproduct.
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