Image source: Getty Images
One of the most coveted elements of investing is receiving a dividend. That said, not all stocks pay dividends and even fewer can pay their dividends on a monthly cadence. Luckily, there's a TSX dividend stock that pays a monthly dividend to consider right now.
that action is Foreign Exchange Income Corporation (TSX:EIF) and here's why you should invest in the Exchange right now.
Meet Exchange Income Corporation
Most investors don't know about the Exchange or, more specifically, how lucrative an Exchange investment is. For those unfamiliar with stocks, the Exchange is an acquisition-focused company with more than a dozen subsidiary companies.
Those subsidiaries are broadly classified into two segments comprising aviation and manufacturing. Both segments have two key characteristics in common that are worth mentioning to potential investors.
First, all of those subsidiaries generate free cash for the company. This is important because it allows the Exchange to invest in growth initiatives while also paying a juicy monthly dividend.
The second point to keep in mind is that subsidiaries provide a necessary service in the market niches they serve. These often have no or extremely limited competition, which provides an element of appeal.
This not only provides a defensive moat for the company, but can also be a lucrative source of income.
As an example, let's consider the aviation segment. Exchange subsidiaries there provide passenger, cargo and medical evacuation services to Canada's remote northern regions. Regarding the manufacturing segment, examples include custom manufacturing services for the defense market, as well as cell tower manufacturing services.
Why you need Exchange in your wallet
One of the main reasons investors flock to the Exchange is because of that lucrative monthly payment. At the time of writing, the Exchange is offering a juicy 5.5% yield. This makes TSX dividend stocks one of the highest-paying options to consider right now.
That tasty return also means that investors with $30,000 to invest can expect to earn $125 each month with the Exchange. Even better, investors not yet ready to take advantage of that income can choose to reinvest that dividend. This allows it to grow even more over a longer period of time.
Speaking of growth, the Exchange continues to provide generous annual increases to that dividend. In fact, the company has provided increases to that monthly cash dividend for 17 of the last 19 years.
That fact alone makes the Exchange a great buy-and-forget TSX dividend stock to consider in your portfolio.
Buy TSX Dividend Stocks That Pay Monthly
No stock, even the most defensive, is risk-free, and that includes Exchange. Fortunately, the Exchange is a well-diversified option that can provide years of opportunity for both growth and income-seeking investors.
In my opinion, Exchange should be a core holding as part of any well-diversified long-term portfolio.
Buy these TSX dividend stocks today, hold them, and watch them (and your future income) grow.