Welcome!

Containers Expo Blog Authors: Derek Weeks, Mehdi Daoudi, Kevin Benedict, Pat Romanski, Liz McMillan

News Feed Item

Zacks Investment Ideas feature highlights: an ETN from JP Morgan, Natural gas, Infrastructure, High Income andVanguard REIT Index ETF

CHICAGO, Dec. 7, 2012 /PRNewswire/ -- Today, Zacks Investment Ideas feature highlights Features: an ETN from JP Morgan (AMEX:AMJ), Natural gas (AMEX:MLPG), Infrastructure (AMEX:MLPI), High Income (AMEX:MLPY) and Vanguard REIT Index ETF (AMEX:VNQ).

(Logo: http://photos.prnewswire.com/prnh/20101027/ZIRLOGO)

No Dividend Tax Debate for These High-Yield ETFs

 No matter what side of the fiscal cliff debate you are on, it seems pretty clear that taxes are going up. Both sides are now proposing new increases with some forecasting that over $1 trillion in new revenues will be collected over the next decade.

A big part of this increase could very well be in the form of new dividend taxes. By some estimates, this favorable rate—which is currently at 15%-- could nearly triple if we go over the Fiscal Cliff, pushing these rates (possibly) up to just south of 45%.

This situation has certainly impacted investors that have a dividend focus, pushing down firms that are in traditional high yield sectors. Key dividend stocks in sectors like utilities have been getting crushed, and other firms with big payouts haven't exactly been doing much better with this cloud of uncertainty (also read 3 ETFs to Prepare for the Fiscal Cliff).

Yet even with this issue, high payout stocks remain in great demand among a variety of investors, thanks to the low rate environment and the lack of quality alternatives in the bond world. So what is an investor to do if they want to still capture high yields but are looking to avoid the risks that come with a massive dividend tax increase?

Focus on Ordinary Income

While most securities pay out investors in the form of qualified dividends, there are a few that utilize a different structure in order to have their yields be categorized as 'ordinary income'. Generally speaking, this is done to avoid double taxation, but it also results in huge payouts, as usually more than 90% of income must be paid out to investors on a yearly basis.

Although it is true that the current rate on ordinary income—for the top bracket—is also expected to rise, it could still stay below the 40% mark. This means that if dividend rates go up to their highest projected level, income derived from ordinary income focused securities could actually be a better deal from a tax perspective while having less policy risk before any decision is made as well (read Escape the Cliff with These Dividend ETFs).

If that wasn't enough, these securities usually pay out more to investors anyway so they could truly become a top yield destination if the worst happens with the Cliff. While individual stocks could certainty be a way to approach this problem, an ETF technique could offer added benefits thanks to the structure and diversification of these products.

So for investors looking for a different high yielding play that could be relatively unscathed by the current dividend issue, a look to any of the following three ETFs may be the way to go:

MLPs

Master Limited Partnerships are often viewed as the 'toll roads' of the commodity world. They are usually pipelines or similar types of assets that store or move products like oil or natural gas, making them less sensitive to economic conditions while also having very stable businesses.

As you might be able to guess, these are partnerships so investors do have to fill out a K-1 form at tax time. However, if investors buy up ETNs in this space—which are structured as debt that seeks to track an index—this tax headache is avoided while still allowing for all of the taxation benefits (and high yields) that come from investing in the MLP world.

One of the most popular, and oldest, in this respect, is (AMEX:AMJ), an ETN from JP Morgan. It tracks the Alerian MLP Index, charging investors 85 basis points a year in fees while 50 securities are in the underlying index (see How to Play the MLP ETF Space).

Yields come in above 5% for this ETN, while average volume is approaching one million shares a day. If that wasn't enough, investors also have a host of other similar ETNs in the space, each of which have a different focus like natural gas (AMEX:MLPG), infrastructure (AMEX:MLPI), or high income (AMEX:MLPY), so there are certainly a variety of options for those who want to take this route.

Real Estate

REITs, or Real Estate Investment Trusts, are arguably the most famous of the group and are best known for their outsized payouts. These securities invest in real estate projects or manage homes and buildings, making them a much more liquid way to buy up real estate.

The space has over a dozen ETFs giving investors plenty of choices and various ways to delve deeper into a particular sector. While there are a number of broad funds in the REIT ETF world, the most popular is easily the Vanguard REIT Index ETF (AMEX:VNQ).

This is an ultra cheap choice—just ten basis points a year in fees-- that sees great volume of over three million shares a day. The yield is also pretty good, coming in at roughly 3.5% in 30 Day SEC terms suggesting that it could also be a decent yield destination (see Is the Panic Over for mREIT ETFs?).

The ETF also does a great job of spreading out assets as it has over 115 companies in total. Still, SPG takes up a decent chunk at over 10% of the total, but beyond that the fund is quite even and even puts 50% of the assets in securities that are mid caps or smaller.

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Len Zacks. The company continually processes stock reports issued by 3,000 analysts from 150 brokerage firms.  It monitors more than 200,000 earnings estimates, looking for changes.

Then when changes are discovered, they're applied to help assign more than 4,400 stocks into five Zacks Rank categories:  #1 Strong Buy, #2 Buy, #3 Hold, #4 Sell, and #5 Strong Sell. This proprietary stock picking system; the Zacks Rank, continues to outperform the market by nearly a 3 to 1 margin.  The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter Profit from the Pros.  In short, it's your steady flow of profitable ideas GUARANTEED to be worth your time.  Get your free subscription to Profit from the Pros at:  http://at.zacks.com/?id=7298

Follow us on Twitter:  http://twitter.com/ZacksResearch

Join us on Facebook:  http://www.facebook.com/ZacksInvestmentResearch

Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.

Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.

Media Contact

Zacks Investment Research

800-767-3771 ext. 9339

[email protected]

http://www.zacks.com

SOURCE Zacks Investment Research, Inc.

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

@ThingsExpo Stories
To get the most out of their data, successful companies are not focusing on queries and data lakes, they are actively integrating analytics into their operations with a data-first application development approach. Real-time adjustments to improve revenues, reduce costs, or mitigate risk rely on applications that minimize latency on a variety of data sources. In his session at @BigDataExpo, Jack Norris, Senior Vice President, Data and Applications at MapR Technologies, reviewed best practices to ...
A strange thing is happening along the way to the Internet of Things, namely far too many devices to work with and manage. It has become clear that we'll need much higher efficiency user experiences that can allow us to more easily and scalably work with the thousands of devices that will soon be in each of our lives. Enter the conversational interface revolution, combining bots we can literally talk with, gesture to, and even direct with our thoughts, with embedded artificial intelligence, whic...
Cloud Expo | DXWorld Expo have announced the conference tracks for Cloud Expo 2018. Cloud Expo will be held June 5-7, 2018, at the Javits Center in New York City, and November 6-8, 2018, at the Santa Clara Convention Center, Santa Clara, CA. Digital Transformation (DX) is a major focus with the introduction of DX Expo within the program. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive ov...
Smart cities have the potential to change our lives at so many levels for citizens: less pollution, reduced parking obstacles, better health, education and more energy savings. Real-time data streaming and the Internet of Things (IoT) possess the power to turn this vision into a reality. However, most organizations today are building their data infrastructure to focus solely on addressing immediate business needs vs. a platform capable of quickly adapting emerging technologies to address future ...
With tough new regulations coming to Europe on data privacy in May 2018, Calligo will explain why in reality the effect is global and transforms how you consider critical data. EU GDPR fundamentally rewrites the rules for cloud, Big Data and IoT. In his session at 21st Cloud Expo, Adam Ryan, Vice President and General Manager EMEA at Calligo, examined the regulations and provided insight on how it affects technology, challenges the established rules and will usher in new levels of diligence arou...
In his session at 21st Cloud Expo, Raju Shreewastava, founder of Big Data Trunk, provided a fun and simple way to introduce Machine Leaning to anyone and everyone. He solved a machine learning problem and demonstrated an easy way to be able to do machine learning without even coding. Raju Shreewastava is the founder of Big Data Trunk (www.BigDataTrunk.com), a Big Data Training and consulting firm with offices in the United States. He previously led the data warehouse/business intelligence and B...
"Digital transformation - what we knew about it in the past has been redefined. Automation is going to play such a huge role in that because the culture, the technology, and the business operations are being shifted now," stated Brian Boeggeman, VP of Alliances & Partnerships at Ayehu, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
SYS-CON Events announced today that Synametrics Technologies will exhibit at SYS-CON's 22nd International Cloud Expo®, which will take place on June 5-7, 2018, at the Javits Center in New York, NY. Synametrics Technologies is a privately held company based in Plainsboro, New Jersey that has been providing solutions for the developer community since 1997. Based on the success of its initial product offerings such as WinSQL, Xeams, SynaMan and Syncrify, Synametrics continues to create and hone inn...
"Evatronix provides design services to companies that need to integrate the IoT technology in their products but they don't necessarily have the expertise, knowledge and design team to do so," explained Adam Morawiec, VP of Business Development at Evatronix, in this SYS-CON.tv interview at @ThingsExpo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
The 22nd International Cloud Expo | 1st DXWorld Expo has announced that its Call for Papers is open. Cloud Expo | DXWorld Expo, to be held June 5-7, 2018, at the Javits Center in New York, NY, brings together Cloud Computing, Digital Transformation, Big Data, Internet of Things, DevOps, Machine Learning and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding busin...
In his Opening Keynote at 21st Cloud Expo, John Considine, General Manager of IBM Cloud Infrastructure, led attendees through the exciting evolution of the cloud. He looked at this major disruption from the perspective of technology, business models, and what this means for enterprises of all sizes. John Considine is General Manager of Cloud Infrastructure Services at IBM. In that role he is responsible for leading IBM’s public cloud infrastructure including strategy, development, and offering m...
Nordstrom is transforming the way that they do business and the cloud is the key to enabling speed and hyper personalized customer experiences. In his session at 21st Cloud Expo, Ken Schow, VP of Engineering at Nordstrom, discussed some of the key learnings and common pitfalls of large enterprises moving to the cloud. This includes strategies around choosing a cloud provider(s), architecture, and lessons learned. In addition, he covered some of the best practices for structured team migration an...
No hype cycles or predictions of a gazillion things here. IoT is here. You get it. You know your business and have great ideas for a business transformation strategy. What comes next? Time to make it happen. In his session at @ThingsExpo, Jay Mason, an Associate Partner of Analytics, IoT & Cybersecurity at M&S Consulting, presented a step-by-step plan to develop your technology implementation strategy. He also discussed the evaluation of communication standards and IoT messaging protocols, data...
Recently, REAN Cloud built a digital concierge for a North Carolina hospital that had observed that most patient call button questions were repetitive. In addition, the paper-based process used to measure patient health metrics was laborious, not in real-time and sometimes error-prone. In their session at 21st Cloud Expo, Sean Finnerty, Executive Director, Practice Lead, Health Care & Life Science at REAN Cloud, and Dr. S.P.T. Krishnan, Principal Architect at REAN Cloud, discussed how they built...
SYS-CON Events announced today that Evatronix will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Evatronix SA offers comprehensive solutions in the design and implementation of electronic systems, in CAD / CAM deployment, and also is a designer and manufacturer of advanced 3D scanners for professional applications.
22nd International Cloud Expo, taking place June 5-7, 2018, at the Javits Center in New York City, NY, and co-located with the 1st DXWorld Expo will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud ...
22nd International Cloud Expo, taking place June 5-7, 2018, at the Javits Center in New York City, NY, and co-located with the 1st DXWorld Expo will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud ...
DevOps at Cloud Expo – being held June 5-7, 2018, at the Javits Center in New York, NY – announces that its Call for Papers is open. Born out of proven success in agile development, cloud computing, and process automation, DevOps is a macro trend you cannot afford to miss. From showcase success stories from early adopters and web-scale businesses, DevOps is expanding to organizations of all sizes, including the world's largest enterprises – and delivering real results. Among the proven benefits,...
@DevOpsSummit at Cloud Expo, taking place June 5-7, 2018, at the Javits Center in New York City, NY, is co-located with 22nd Cloud Expo | 1st DXWorld Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait...
SYS-CON Events announced today that T-Mobile exhibited at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. As America's Un-carrier, T-Mobile US, Inc., is redefining the way consumers and businesses buy wireless services through leading product and service innovation. The Company's advanced nationwide 4G LTE network delivers outstanding wireless experiences to 67.4 million customers who are unwilling to compromise on qua...