Investors should never chase yield. Buying a dividend stock simply because it offers significantly higher-than-average yields will only set you up for problems. That’s because high-yield stocks often have problems.
Ultra-high-yield stocks can often signify problems with a business, but that’s not a blanket truth, and these three companies show why. But not all ultra-high yield stocks are broken business. Sometimes perfectly healthy companies offer a dividend that results in rising rates. Or it is simply the nature of the industry.
Here are three ultra-high-yield stocks that fit that mold. Their businesses are sound, but the yields offered are lucrative. You may want to buy their stocks by the handful.
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