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NEW YORK (Scott's Investments) -- I have written updates the past two months on a screen I call "High-Yield Stocks with Staying Power." The screen will now be tracked publicly as a continuous hypothetical portfolio with a starting balance of $100,000 on Scott's Investments.

Like many of the screens, strategies and portfolios I track and prefer, this strategy takes a small number of historically relevant ideas, to create a simple, yet powerful action plan for the individual investor. As I have previously detailed, "Some studies have shown that the, highest yielding, low payout stocks perform better over time than stocks with higher payouts and lower yields."


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    Therefore, why not create a portfolio of high-yield, low-payout stocks? In addition, why not feature stocks that have a long history of paying dividends? This portfolio attempts to capture these three simple strategies.

    Each month I will begin with the Dividend Champions list as compiled at DRIP Investing. The list is comprised of stocks that have increased their dividend payout for at least 25 consecutive years. I then take the top third of Dividend Champions based on yield and sort the results based on the top third with the lowest payout ratio. This month's Dividend Champions list has 99 stocks, so the 33 top-yielding stocks were my starting point. I then ranked them based on payout ratio and took the top 11 stocks. These stocks will comprise the month's portfolio.

    The goal is to weigh the odds in our favor that we will be investing in stocks that have historically paid and raised dividends. In addition, we want stocks with high yields in order to increase income received.

    I began tracking the portfolio in December and to date it is up 3.07%, including dividends. For Monday, Feb. 7, the portfolio will sell Sonoco (SON) and buy Kimberly-Clark (KMB).

    This month's top 11 results, or current portfolio effective Monday, are below:

    Data courtesy of Finviz. Portfolio will be updated monthly on around the 5th of the month. Modifications may be made in the future to limit turnover.

    At the time of publication, author had no positions in stocks mentioned.

    Scott's Investments focuses on consolidating and tracking free online investment resources for the public with an emphasis on ETFs, portfolio/trading strategies and macroeconomics. Follow Scott's Investments on Twitter.