The following commentary comes from an independent investor or market observer as part of TheStreet’s guest contributor program, which is separate from the company’s news coverage. The opinions expressed are those of the author and do not represent the views of TheStreet or its management.

NEW YORK (Insider Monkey) -- Pointing to a recent study, we showed that the average return of high-dividend-yielding stocks was 13.04% between 1927 and 2009. Dividend stocks beat the overall market by an average of 1.36% per year in that period.


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    Insider Monkey, your source for free insider trading data, thinks these are risky times for fixed income investors. Ten-year treasuries yield less than 4% and the Federal Reserve is pursuing a highly inflationary monetary policy. Legendary investors Warren Buffett, George Soros and Jim Rogers already voiced their concerns about the Fed’s policy. Warren Buffett thinks investing in long-term bonds is a bad idea. Jim Rogers is certain that commodities will benefit no matter what happens in the world economy. Ray Dalio, the owner of the world’s biggest hedge fund, recommended gold and emerging market securities.

    For conservative investors who don’t want to speculate about commodities and want a stable quarterly income, we prepared a list of 35 dividend-paying stocks that have below-market-average P/E ratios and managed to increase their earnings per share over the past five years. A portfolio of these stocks should be able to make its dividend payments, preserve capital by increasing earnings per share over the long term, and protect investors against possible spikes in inflation. The data is sourced from Google Finance. We expect these stocks to perform better than 10-year treasuries over the next 10 years.

    Some of these stocks are also popular among hedge funds and insiders. Jim Simons’ Renaissaince Technologies has Lockheed (LMT) in its portfolio. Several insiders bought LMT, Con Ed (ED) and Scana (SCG). Mohnish Pabrai has recently added BPO to his portfolio. Andreas Halvorsen’s Viking Global and Ray Dalio’s Bridgewater have large H&R Block (HTB) positions. Dan Loeb and Leon Cooperman are invested in KKR Financial Holdings (KFN). There were recent insider purchases in KFN as well.

    This was originally published on Insider Monkey.