Most investors like you focus only on dividends. But that misses half the story. This article shows you a better strategy: Shareholder Yield — which combines dividends and share buybacks. You will learn why this approach beats simple dividend investing, and how it lowers risk.
You will also see how to find high-yield, market-leading stocks using a proven system. If you want safer, higher income — and peace of mind — this guide is for you.
Estimated Reading time: 6 minutes
If you are like most income investors, you probably focus on dividends. They feel safe, familiar, and steady. But here is the problem — dividends only tell half the story. You might be missing out on stronger returns without even knowing it.
The strategy I am about to show you — called Shareholder Yield — goes beyond dividends. It adds something powerful: share buybacks. And when you combine the two, your income potential can grow, and your risk goes down.
You do not need to be a professional to start using this powerful strategy. You just need the right system and a bit of curiosity.
What Is Shareholder Yield?
Shareholder Yield is simple. It is a number that tells you how much money a company gives back to you, the investor. It adds together two things:
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The dividend yield (cash the company pays you),
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And the buyback yield (how much the company spends buying back its own shares).
Shareholder Yield = Dividend yield + Percentage of Shares Repurchased
When a company buys back shares, it reduces the total number of shares in the market. That makes each share, including yours, more valuable. Think of it like slicing a pizza. Fewer people at the table means more pizza for you. Best of all, buybacks are often more tax-efficient than dividends.
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Why It Outperforms Dividend Yield Alone
Most investors chase high dividend stocks. But that can be dangerous. Some companies with high dividends are in trouble, they pay out more than they can afford just to keep investors happy. These are called dividend traps.
Shareholder Yield avoids that problem. It includes buybacks, which many healthy companies use to return money.
According to Jim O’Shaughnessy’s research, stocks with high Shareholder Yield beat the market 95% of the time over 7 years and gave you an over 3.4% higher return per year than the market.
Source: 7 Traits for Investing Greatness
Real Example: Barclays - High Shareholder Yield, High Return
Let me give you a real example. One of our September 2023 newsletter picks was Barclays PLC. Most investors saw a modest dividend of 2.8% and moved on. But Barclays was doing massive buybacks. We included it in our Shareholder Yield Letter — and it returned over +105% in a year!
That is the power of seeing the full picture. If you had looked only at dividends, you would have missed this. But Shareholder Yield captured both steady income plus upside from buybacks. That is a win-win, especially if you are retired or close to it.
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Why the Shareholder Yield Letter Is the Right Tool
You might be thinking, “This sounds great, but how do I find these stocks myself?” That is exactly why we created the Shareholder Yield Letter. It is built for investors like you who want income but also care about protecting their capital and growing it over time.
Every pick we share follows a tested system. We screen only large, market leader companies — average market cap is over $50 billion. The average shareholder yield around 6%. We also stop buying when the market is falling, so you avoid the worst drawdowns. It is ideal if you want to enjoy your retirement, not stress over market noise.
Inside the Shareholder Yield Letter Strategy
Here is what happens behind the scenes. First, we check the overall market. If the MSCI World Index is not above its 200-day moving average, we pause new ideas. This helps protect your money during down markets.
Next, we use a powerful screener to filter for companies with:
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Market Leading companies worldwide
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High Shareholder Yield,
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Strong financials over 5 years.
Then we run every stock through a 23-point checklist to avoid risks. We do not guess. We do not rely on hunches. We follow the data. And every month, we review each position: if it drops 20%, we sell. If it still fits the model, we hold.
Your Next Step
This strategy works. It is backed by decades of research, proven returns, and simple rules.
You do not need to watch the market daily. You do not need to become a financial expert. You just need a system that puts your money to work, without stress.
👉 Want to see it in action?
Have a look before you subscribe? Simply click on the “Need help?” button at the bottom right of your screen to send us an email with “Shareholder Yield trial issue” in the email and we will send you a recent issue to review.
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FREQUENTLY ASKED QUESTIONS
1️. What is Shareholder Yield, and why should I care?
Shareholder Yield tells you how much cash a company gives back to you each year. It includes two things:
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Dividends (cash you receive),
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Buybacks (when the company buys its own shares, making yours more valuable).
Most people only look at dividends. But Shareholder Yield shows the full picture. Companies that do both often give you better returns and lower your risk.
2️. Is this strategy only for experts?
No, not at all. You do not need to be a pro. Shareholder Yield is simple once you understand it:
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Look for big, strong companies.
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Check if they pay good dividends and buy back shares.
Our Shareholder Yield Letter does this work for you, but you can also learn to spot these companies yourself. It is a smart way to grow and protect your money.
3️. I love dividends. Why should I look at buybacks too?
Great question. Dividends are nice, but buybacks can be even better:
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They increase your share’s value.
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They are often more tax-friendly (you might not pay tax right away like with dividends).
When you combine dividends + buybacks, you get a stronger and safer income stream.
4️. How do I avoid “dividend traps”?
A dividend trap is when a company pays a high dividend it cannot afford. This is risky because:
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The company might be in trouble.
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It may cut the dividend soon.
By using Shareholder Yield, you look beyond just dividends. You check if the company is also buying back shares and has strong financials. This helps you avoid traps and invest in healthier companies.
5️. What happens if the market starts falling?
Good news: the Shareholder Yield system pauses buying when the market drops. It checks if the MSCI World Index is above its 200-day moving average. If not, we wait. This protects you from buying into a falling market and helps avoid big losses.
6️. Can you give a real-life example?
Sure! In 2023, many skipped Barclays because its dividend looked small (2.8%). But Barclays was also doing big buybacks. We included it in our Shareholder Yield Letter—and it returned over +105%. That is the power of looking at the full picture, not just the dividend.
7️. What if one of my stocks drops a lot?
We use a simple rule: if a stock drops more than 20% from its peak, we sell. This helps you cut losses early. Every month, we also check if the stock still fits the model. If it does, we hold. If not, we sell. This keeps your portfolio strong and safe.
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