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Energy Dividends

Energy and Capital's Weekend Edition

Written by Nick Hodge
Posted April 28, 2012

You know, the real way to riches is to invest early and invest often.

If you start when you're 20, you can double your money well before retirement with just a 2% return.

Look at this table showing how interest affects a $10,000 investment:

Time Period

5% Return

7% Return

10% Return

10 Years




20 Years




30 Years




40 Years




It's the tortoise approach in a world where everyone is focused on hare-like gains.

And more often than not, it will help you win the financial race.

Fortunately, the energy sector can deliver both explosive gains and guaranteed long-term returns.

Just this week, Exxon (NYSE: XOM) raised its quarterly dividend by 21% to $0.57 per share. That makes it the largest payer of dividends in the world, paying out more than $10.7 billion every year.

That means every quarter Exxon will pay you $0.57 for every share you own.

If you have 100 shares of Exxon, that's another $228 in your pocket every year.

You can use that to buy more shares that will earn you more dividends.

That's the road to financial independence...

That's how Romney pays a lower tax rate than you or I, but makes millions more.

While Exxon may pay out the most in dividends, other companies pay a higher percentage, which will help you increase returns more quickly.

Pipeline operator TransCanada (NYSE: TRP) just declared a quarterly dividend of $0.44 per share, or $1.76 per share per year. With a share price of $44.00, that's a 4% return — even higher than the 2.5% Exxon is offering.

Others are even steeper; you just have to do a little digging.


Natural gas infrastructure play Enterprise Products Partners (NYSE: EPD) is paying almost 5%.

And with energy in a decades-long bull market, you can profit from the appreciation of the stocks as well.

Any bank accounts you know paying that much?

Start looking at trusts, which rent land to companies to drill for oil and gas, and the dividends get even better...

The Permian Basin Royalty Trust (NYSE: PBT) is paying 6.4%. The ECA Marcellus Trust (NYSE: ECT) is paying 11.7%.

That's guaranteed money in the bank.

You can find the rest of this week's coverage below.  

Call it like you see it,

Editor, Energy and Capital

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