Kevin O’Leary, the venture capitalist famous for his role on ABC’s Shark Tank, recently shared his investment strategy on LinkedIn, emphasizing the importance of cash-flowing investments in a well-balanced portfolio. O’Leary, also known as “Mr. Wonderful,” has revealed that the bulk of his family’s wealth is parked in ETFs, particularly those that focus on quality dividends and positive cash flow.
In his post, O’Leary stated, “A couple of years back, I sold my ETF company to Alps, the biggest ETF player in the States. It’s called O’Shares, and that’s where my family’s wealth is parked. OUSA is part of the S&P 500, cherry-picking the highest quality balance sheets with positive cash flow from around 100 out of the 500 names. Then there’s OUSM, which grabs the Russell 2000 and weeds out the underperformers – those companies not making any real dough.”
O’Leary’s emphasis on cash flow is a reminder that while high-risk, high-reward investments like those on Shark Tank or volatile assets like Bitcoin can be exciting, the foundation of a solid investment portfolio lies in steady, reliable income. “Forget Shark Tank, forget Bitcoin. Sure, I’ve got a 5% stake in Bitcoin and another 5% in gold, but the meat of my US portfolio? It’s in OUSA or OUSM,” O’Leary added.
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The ALPS O’Shares US Quality Dividend ETF (BATS:OUSA) and the ALPS O’Shares US Small-Cap Quality Dividend ETF (BATS:OUSM) are designed to provide investors with exposure to large-cap and small-cap dividend-paying companies that exhibit quality and low volatility. These ETFs aim to offer a balance of income and growth, with a focus on companies that have strong balance sheets and a history of dividend growth.
Adding Passive Income To Your Portfolio
For investors looking to add yield-producing assets to their portfolio, ETFs like OUSA and OUSM can be an attractive option. They offer the potential for steady income through dividends, as well as the opportunity for capital appreciation.
Investors can often find higher yields through alternative assets, which typically have a low correlation to the stock market. Here are two income-generating assets to consider adding to your portfolio.
Real Estate
Real estate can be an excellent source of passive income. Investing in properties, whether residential or commercial, can provide steady rental income alongside potential appreciation in value over time. For those interested in exploring private market real estate investment opportunities, Benzinga’s real estate offering screener has a curated list of offerings that cater to various investment preferences and goals. Minimum investments start at just $100 and options are available to both accredited and non-accredited investors.
Private Credit
In addition to real estate, private credit is an alternative investment option that can generate attractive yields. Real estate notes, in particular, allow investors to earn interest income by providing financing to property owners or buyers. These notes can offer a fixed return and serve as a diversification tool within an income-focused portfolio. These real estate notes allow anyone to start investing with as little as $500.
In an uncertain market, having a portion of your portfolio dedicated to cash-flowing investments can provide a measure of stability and help mitigate risk. While the allure of quick gains from speculative investments can be tempting, Kevin O’Leary’s investment strategy highlights the importance of having a strong foundation of cash-flowing assets. Whether it’s dividend stocks, ETFs, real estate or private credit, incorporating yield-producing investments into your portfolio can provide a steady stream of income and long-term financial security.
TORONTO – Canada’s main stock index was up more than 100 points in late-morning trading, helped by strength in base metal and utility stocks, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 103.40 points at 24,542.48.
In New York, the Dow Jones industrial average was up 192.31 points at 42,932.73. The S&P 500 index was up 7.14 points at 5,822.40, while the Nasdaq composite was down 9.03 points at 18,306.56.
The Canadian dollar traded for 72.61 cents US compared with 72.44 cents US on Tuesday.
The November crude oil contract was down 71 cents at US$69.87 per barrel and the November natural gas contract was down eight cents at US$2.42 per mmBTU.
The December gold contract was up US$7.20 at US$2,686.10 an ounce and the December copper contract was up a penny at US$4.35 a pound.
This report by The Canadian Press was first published Oct. 16, 2024.
TORONTO – Canada’s main stock index was up more than 200 points in late-morning trading, while U.S. stock markets were also headed higher.
The S&P/TSX composite index was up 205.86 points at 24,508.12.
In New York, the Dow Jones industrial average was up 336.62 points at 42,790.74. The S&P 500 index was up 34.19 points at 5,814.24, while the Nasdaq composite was up 60.27 points at 18.342.32.
The Canadian dollar traded for 72.61 cents US compared with 72.71 cents US on Thursday.
The November crude oil contract was down 15 cents at US$75.70 per barrel and the November natural gas contract was down two cents at US$2.65 per mmBTU.
The December gold contract was down US$29.60 at US$2,668.90 an ounce and the December copper contract was up four cents at US$4.47 a pound.
This report by The Canadian Press was first published Oct. 11, 2024.
TORONTO – Canada’s main stock index was little changed in late-morning trading as the financial sector fell, but energy and base metal stocks moved higher.
The S&P/TSX composite index was up 0.05 of a point at 24,224.95.
In New York, the Dow Jones industrial average was down 94.31 points at 42,417.69. The S&P 500 index was down 10.91 points at 5,781.13, while the Nasdaq composite was down 29.59 points at 18,262.03.
The Canadian dollar traded for 72.71 cents US compared with 73.05 cents US on Wednesday.
The November crude oil contract was up US$1.69 at US$74.93 per barrel and the November natural gas contract was up a penny at US$2.67 per mmBTU.
The December gold contract was up US$14.70 at US$2,640.70 an ounce and the December copper contract was up two cents at US$4.42 a pound.
This report by The Canadian Press was first published Oct. 10, 2024.
