Morgan Stanley (MS)

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The financial sector has made a strong comeback after being hit hard by the pandemic. And banks are rewarding shareholders with major “pay raises.”

Case in point: Financial giant Morgan Stanley announced a 100% increase to its quarterly dividend rate in June. It also plans to buy back as much as $12 billion of its own shares through June 2022.

In Q3 of 2021, both revenue and net income increased by more than 25% from the year-ago period.

The investment bank currently sports an annual dividend yield of 2.9%, higher than what’s being offered by other big financial stocks like Bank of America (1.9%), Goldman Sachs (2.1%), and JPMorgan Chase (2.5%).

To be sure, Morgan Stanley shares trade at nearly $100 apiece. But you can get a slice of the bank using a popular stock trading app that allows you to buy fractions of shares with as much money as you are willing to spend.

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Verizon Communications (VZ)

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Moving up the yield ladder, we have telecom giant and household name Verizon.

The company’s 4G LTE network covers 99% of the U.S. population. It’s also one of the first to deploy 5G in the country.

At the end of June, Verizon’s consumer segment had 94.6 million retail connections, 90.5 million of which were postpaid.

With customers paying Verizon every single month, the company is able to deliver a healthy stream of recurring dividends to investors.

Last month, Verizon boosted its quarterly payout to 64 cents per share, which translates to an annual dividend yield of 5%.

Arch rival AT&T is yielding an even juicier 8.1% as of this writing. But earlier this year, management hinted at a potential dividend cut.

The telecom sector hasn’t been a market favorite over the past six months.

But if you’re on the fence about jumping in, some investing apps will give you a free share of Verizon or AT&T just for signing up.

Ellington Residential Mortgage REIT (EARN)

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For dividend investors who really crave high yields, check out Ellington Residential Mortgage REIT.

Structured as a real estate investment trust, it invests and manages residential mortgage and real estate-related assets.

Ellington has a unique focus: mortgage-backed securities for which the principal and interest payments are guaranteed by a U.S. government agency.

In June, Ellington Residential raised its quarterly dividend rate from 28 cents per share to 30 cents per share.

More recently, management decided to switch to a monthly distribution schedule and declared an inaugural monthly dividend of $0.10 per share payable on Nov. 26.

“By shifting to a monthly dividend,” CEO Laurence Penn says, “we are further aligning our distribution practices with the interests and expectations of income-oriented shareholders.

At the current share price, the REIT offers a mouth-watering dividend yield of 10.2%.

While commercial real estate to has always been reserved for a few elite investors, outperforming the S&P 500 over a 25-year period, First National Realty Partners allows you to access institutional-quality commercial real estate investments — without the leg work of finding deals yourself.

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Collect regular rental checks without being a landlord

Owning real estate is one of the oldest ways to earn a passive income.

But you don’t need to be a landlord to collect rent checks. And you don’t have to limit yourself to the stock market.

For instance, some popular investing services let you lock in a steady rental income stream by investing in premium real estate properties — from commercial developments in LA to residential buildings in NYC.

You’ll gain exposure to high-end properties that big-time real estate moguls usually have access to.

And the best part? You'll receive regular payouts in the form of quarterly dividend distributions without any headaches or hassles.

Fine art as an investment

Stocks can be volatile, cryptos make big swings to either side, and even gold is not immune to the market’s ups and downs.

That’s why if you are looking for the ultimate hedge, it could be worthwhile to check out a real, but overlooked asset: fine art.

Contemporary artwork has outperformed the S&P 500 by a commanding 174% over the past 25 years, according to the Citi Global Art Market chart.

And it’s becoming a popular way to diversify because it’s a real physical asset with little correlation to the stock market.

On a scale of -1 to +1, with 0 representing no link at all, Citi found the correlation between contemporary art and the S&P 500 was just 0.12 during the past 25 years.

Earlier this year, Bank of America investment chief Michael Harnett singled out artwork as a sharp way to outperform over the next decade — due largely to the asset’s track record as an inflation hedge.

Investing in art by the likes of Banksy and Andy Warhol used to be an option only for the ultrarich. But with a new investing platform, you can invest in iconic artworks just like Jeff Bezos and Bill Gates do.

About the Author

Jing Pan

Jing Pan

Investment Reporter

Jing is an investment reporter for MoneyWise. Prior to joining the team, he was a research analyst and editor at one of the leading financial publishing companies in North America. An avid advocate of investing for passive income, he wrote a monthly dividend stock newsletter for the better half of the past decade. Jing holds a Master’s Degree in Economics and an Honours Bachelor of Science Degree, both from the University of Toronto.

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