(09-25-2021, 08:15 AM)bankerboy Wrote: VZ was my last purchase a few weeks back. AbbVie will be my next just being patient to see it drop a bit more.This is a thread I hope we keep alive. We'll have to wait for a dip for more candidates.
After that it gets murky, so many in this yield category are value traps over the last 10 years when the broader market has really grown making it tough to jump in right now for folks who are 7 years or more out like me.
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ABBV still seems like the most obvious. Some insurance companies and financials are close. The 10 year chart is a good standard for yield trap status or not. Oil and tobacco have been just, that trailing SPY by a mile. I own them but they are yield traps until proven otherwise. A 4%+ yield is asking for 3X the risk free return of a 10yr treasury so we'll wait for a dip. There are exceptions but mostly we accept a stock with fleas for now. High debt, little growth etc.
This is why I sell covered calls. Boring stuff becomes high yield with less risk.