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On average, monthly dividend stocks yield significantly higher returns than their quarterly counterparts, with annual yields ranging from 8% to 19.8%. For a $500,000 investment in such stocks, investors could expect annual dividends between $40,000 and $99,000.
Highlighted stocks include Sabine Royalty Trust (SBR), offering an 8% yield, and Capital Southwest Corp. (CSWC) with a 12.7% yield. Additionally, PennantPark Floating Rate Capital (PFLT) provides a 14.0% yield, while Orchid Island Capital (ORC) boasts a yield of 19.8%. Each of these companies focuses on distinct sectors such as real estate and capital investment, emphasizing the potential for stable income streams through monthly dividends.
Investors should note the risks associated with these dividends. For instance, SBR’s distribution aligns closely with commodity prices, making it volatile, and ORC’s stock has dropped 90% since its IPO despite high dividends. This highlights the importance of assessing both potential income and associated risks when considering monthly dividend stocks.
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