Income investors groaned at the news of the Fed’s recent decision to hold rates in their near-zero rate rut until late 2014. That could mean nearly three years until we see an uptick in interest rates which points to three years of scrapping for steady income around markets as interest rates of 0.25% are less than enticing for most investors. But for those who live and die by dividend yields, there are still a number of options available, especially in the commodity space. Investing on the equity side of commodities can offer low correlation (though not nearly as low as the direct commodity itself) while providing a handsome income stream [see also 12 High-Yielding Commodities For 2012].
Over the years, value investing has emerged as one of the favorite strategies for a number of individuals and advisors. A steady stream of income that dividends provide can help protect a portfolio from market dips as well as adding an inflation hedge. The methodology has become so popular that some investors swear by it and are uneasy about making allocations to anything that lacks an important dividend yield. Many feel that value principles conflict with the commodity space; when someone thinks of commodity investing, they typically think of active trading of futures contracts or exchange traded products. But there are a number of securities that may be overlooked [see also Dividend Special: Top Companies In Every Major Commodity Sector].
Coal has been mined across the world since the Bronze Age, becoming an important commodity during Roman times, especially in what is today Great Britain. However, the true Golden Age of coal began with the start of the Industrial Revolution in Europe and North America in the late 1700′s and early 1800′s. Coal was cheaper than wood for fuel and nearly as abundant, helping to power steam engines across the continent and get the world’s economy going into the industrial age. After the steam engine, coal became an important fuel source for the modern electric utility company, which can trace its start back to the early 1880′s. Once again, coal was an abundant fuel source that was easy to burn and turn into electricity, ensuring that the mineral became one of the most popular ways for mankind to power their homes and businesses.