Dear Mr. Berko:

M.B., Jonesboro, Ark.

Dear M.B.:

The following is a list of utility issues that I believe can provide you with a steady and safe income stream through good and bad economic times.

When the economy returns to a growth mode, these issues should experience better-than-average revenue growth, which should produce higher income and dividend growth.

The yield on this utility portfolio is a tad over 5.2 percent today, and because I think the Dow Jones industrial average might continue lower in the coming 12 months, it’s reasonable to assume that these issues eventually can be purchased at lower prices. So I recommend that you place a large portion of your orders below their current market prices.

This is called a “Good Till Cancel Stop Order” (GTC) and it should be marked “Do Not Reduce” (DNR). This order stays in effect until you cancel it. When the stock falls to the price you chose, your order is immediately executed on the next trade. The DNR tells the brokerage that it should not reduce the stock price by the amount of the dividend. So divide your $100,000 into four piles of $25,000, and follow the instructions below.

Today, invest the first $25,000 pile at the prevailing market price:

Invest $5,000 in Ameren Corp. (AEE-$28.50), which provides power to Missouri and Illinois. Its $1.54 dividend yields 5.4 percent.

Invest $5,000 in PPL Corp. (PPL-$27.29), which provides power to the northeastern United States and the United Kingdom. Its $1.40 dividend yields 5.1 percent.

Invest $5,000 in American Electric Power Co. (AEP-$37.26). AEP provides power to 5.2 million customers in 11 Midwestern states. The $1.84 dividend yields 4.9 percent.

Invest $5,000 in Entergy Corp. (ETR-$62.48), which provides electricity and natural gas to 2.8 million users in Arkansas, Mississippi, Texas and Louisiana. Its $3.32 dividend yields 5.3 percent.

Finally, invest $5,000 in UIL Holdings Corp. (UIL-$32.07), which sells power and natural gas to 17 Connecticut communities. The $1.73 dividend yields 5.4 percent.

After you have purchased these five issues, place GTC-stop-DNR orders at 6 percent below the price you just paid for each of them. When the orders are executed, you will purchase $5,000 of AEE at $26.79 with a 5.7 percent yield; $5,000 of PPL at $25.65 with a 5.5 percent yield; $5,000 of AEP at $35.02 with a 5.3 percent yield; $5,000 of ETR at $58.73 with a 5.7 percent yield; and $5,000 of UIL at 30.15 with a 5.7 percent yield.

Be patient. These orders might take several months to execute.

Do the same with the third $25,000, again reducing the price of each issue by 6 percent. Once you have invested $75,000, you’ll have a total dividend yield of 5.5 percent.

In the coming dozen years, it’s reasonable to assume an average annual total return between 8 and 9 percent.

Keep the remaining $25,000 in a money market account. Cash gives you time to think, and during the next 12 months, there certainly will be some good bargains.

Please address your financial questions to Malcolm Berko, P.O. Box 1416, Boca Raton, Fla. 33429 or email him at malber@adelphia.net. ©2011 Creators.com