Investors who are only focussing on yield are missing a huge opportunity to invest in companies that are growing and potentially offering returns far higher than yield stocks.
Whilst you'd be hard pressed to find too many companies providing yields of over 6%, there are plenty of companies which are growing at rates faster than 6%.
The lazy man's way to get rich
I suspect one of the factors leading investors to target yield is that they are lazy. The idea of a regular dividend being deposited in their bank account is their main aim. While this will provide a steady stream of income it won't make you rich.
In reality the way to get really rich is to be really lazy!
Buying growth stocks that compound for many years is the ideal way to grow your wealth – if you need some income, just sell a few shares…the effort required isn't really that great!
So here are three stocks to consider for those investors who want to be really lazy and buy stocks they can watch compound over a number of years.
Ozforex Group Ltd (ASX: OFX) has developed a leading online international payment service which is competitively priced against its larger, more entrenched peers such as the major banks. With international commerce and travel continuing to rise – and not looking like it will slow down anytime soon – OzForex should be a major beneficiary.
ResMed Inc. (CHESS) (ASX: RMD) is a leading medical device company that specialises in apparatus for breathing disorders. ResMed's products are gaining in popularity and acceptance which provides a solid pipeline of growth; coupled with its exposure to US dollar earnings, Australian investors should be well positioned to gain.
Macquarie Group Ltd (ASX: MQG) is a leading investment bank with operations in most regions around the globe. The company is innovative which allows it to seize opportunities when they present themselves. While financial leverage works both ways, Macquarie's operating margins should provide appealing long-term earnings growth.
