The world's biggest bond fund manager, Pimco's Bill Gross, issued his December newsletter this week. The title, "Anything but 0.1%, refers to the national average yield for money market funds. Mr. Gross describes the tough environment for savers right now. Money markets yield 0.1%, one year CD's average 1%, and two-year Treasuries yield less than 0.75%! What is a conservative investor to do for income needs? Mr. Gross describes what Pimco has recently been buying for income in one very overlooked area: utilities. The utility sector has not really participated in this year's market rally because of regulation and political fears. Despite this, many utilities offer a long-term record of steady dividends and actual growth markets. Their dividend yields can be very attractive for some income investors. The track record for Pimco's Bill Gross is second-to-none in the fixed income world, and his latest advice may be very timely.
(This article contains the current opinions of the author but not necessarily those of Brighton Securities Corp. The author's opinions are subject to change without notice. This blog post is for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities).