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Here’s why BHP Billiton Limited sits atop my watchlist

Forget what I said yesterday about the S&P/ASX 200 Index (Index: ^AXJO) (ASX: XJO) getting off to a rough start this new financial year – the index has today risen more than 1.1% after Wall Street hit a record high overnight!

While the gains have been widespread across various sectors, BHP Billiton Limited (ASX: BHP) has shown particular strength, outmuscling the market’s jump to pile on 60c or 1.7% from yesterday’s closing price. Fellow iron ore miners Rio Tinto Limited (ASX: RIO) and Fortescue Metals Group Limited (ASX: FMG) have also gained 1.6% and 0.5% respectively.

Even though the stock is trading higher today, at $36.60, BHP would still make for an excellent addition to your portfolio. For starters, it maintains heavily diversified operations which makes it more defensive than other miners, while it also offers a juicy 3.7% fully franked dividend yield based on distribution forecasts for the 2015 financial year.

While I don’t own the stock currently, it is sitting atop my watchlist in case it drops to an even more compelling price…

3 more resources stocks with potential for big returns

BHP Billiton looks set to deliver solid returns in the long-run, but there are plenty more opportunities to grasp in the resources sector.

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Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned.

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