The Oxford Income Letter Review – Is This Newsletter Legit?

About The Oxford Income Letter

The Oxford Income Letter is a subscription newsletter produced by The Oxford Club, a financial analysis service with a more than 30-year history. The Oxford Income Letter is one of the service’s three flagship newsletters and is run by Marc Lichtenfeld. Lichtenfeld is a biotech expert as well as an experienced fund manager, and he also runs The Oxford Club’s Lightning Trend Trader newsletter.

Let’s learn more about this subscription newsletter in this review of The Oxford Income Letter.

The Oxford Income Letter Pricing Options

The Oxford Income Letter costs $49 per year with a Basic subscription, which only includes a digital copy of the monthly newsletter.

You can upgrade to a Premium subscription for $79 per year (regularly $249), and that includes a physical copy mailed to you each month plus digital copies of four research reports from The Oxford Club. The special reports vary based on the time you sign up, but examples include:

• Dividend Investing Reports
• Retirement Reports
• Specialized Portfolio Reports
• And more.

A Standard subscription includes digital and print editions of the newsletter, but no additional reports – and it costs $129 per year. This plan option seems to exist mainly to make it appear as if the Premium subscription is being heavily discounted.

The Oxford Income Letter Investing Style

The Oxford Income Letter is focused on, as the name suggests, income. It primarily focuses on dividend-paying stocks and bonds. Price appreciation is taken into consideration, but a lot about the newsletter, the way that stock picks are presented, and the division of assets into different portfolios is based on dividend yields.

How Does The Oxford Income Letter Work?

Portfolios

The Oxford Income Letter newsletter is somewhat different from most stock newsletters in that you aren’t getting just one portfolio’s worth of stock picks. Instead, you get four distinct portfolios with different goals (although all of them are payout-related). 

The  Fixed Income Portfolio invests in blue-chip corporate bonds and, to a lesser extent, municipal bonds. Most bonds that the newsletter recommends are rated BBB- or higher and mature in 5 to 10 years. 

The Compound Income Portfolio is effectively a dividend investing portfolio. At the time of writing, the portfolio had an average yield of 5.8% and a projected annual dividend growth of 8%. 

The Instant Income Portfolio focuses on dividend stocks that are poised for short- or medium-term growth. Generally, stocks in this portfolio are only held for months or a year at a time. The average yield was around 5.9% at the time of writing, and the constituent stocks had projected dividend growth of 7.5%.

The Retirement Catch-up/High-yield Portfolio invests in stocks that have high dividend yields at the moment. Not surprisingly, there are often only a few stocks in this portfolio since Lichtenfeld searches for stocks with a dividend yield of more than 10% that aren’t headed for a steep drop. Note that, at the time of writing, two out of three stocks in this portfolio had returned a loss since these high dividend payouts are often made by companies with questionable financial sustainability.

Monthly Newsletter

The Oxford Income Letter is released at the start of each month. Typically, it is split into a few different articles – most of them written by Lichtenfeld, but typically one written by another analyst echoing his recommendations.

The main story explains Lichtenfeld’s single stock pick for the month and ends with instructions about what price to buy the stock at, whether to set a stop loss, and which portfolio to add it to. Interestingly, Lichtenfeld also advises readers about whether to hold the stock in a taxable or retirement account based on its anticipated appreciation and the expected length of the position. Another story explains the bond pick for the month, if there is one.

The portfolio’s performance isn’t discussed in the articles, although each newsletter ends with a series of tables showing the overall performance. More importantly, the tables contain information about whether each stock or bond is rated a buy, hold, or sell. You must check the tables for sell signals, since this is the only way that you get updates about when to remove stocks and bonds from your portfolio.

The Compound Income Portfolio is the largest in the Oxford Income Letter collection, with more than a dozen stocks. Notably, total returns on stocks in this portfolio ranged widely. Some stocks that had been in the portfolio for more than five years had yielded returns of more than 200%, while other stocks recommended in the past year or two had returned losses of -30 to -45%. Lichtenfeld occasionally suggests stop losses when recommending stocks. But if no stop loss was suggested, there is no explanation of why a losing stock is being held – you’re simply given a buy, hold, or sell rating in the portfolio tables at the end of each newsletter.

The Oxford Income Letter Differentiators

The Oxford Income Letter offers something like The Motley Fool’s Stock Advisor, but for dividend stocks. It’s a relatively low-cost service that offers one to two picks per month, and that helps investors build up a portfolio over time.

Importantly, The Oxford Income Letter’s performance is mixed, particularly when it comes to the primary Compound Income Portfolio. Long-term investors would do well to pair these dividend picks with a growth stock portfolio, or at the very least, to set stop losses even when Lichtenfeld does not recommend them.

Want to see how Oxford Income Letter compares to other newsletters? Check out some reviews of similar newsletters below:

• Motley Fool Review (Full Comparison: Oxford Club vs. Motley Fool)
• Gorilla Trades Review
• Forbes Investor Review
• Fidelity Investor Review
• Nate’s Notes Review
• Action Alerts Plus Review
• Stansberry Research Review

What Type Of Trader is The Oxford Income Letter Best For?

The Oxford Income Letter is best for long-term investors, and particularly retirement investors. The newsletter focuses primarily on generating future income by investing in stocks with sustainable dividend yields and high dividend growth projections. Bond investments also generate reliable income for the future. There isn’t much that’s self-directed about the newsletter, which is nice for investors who want to be given concrete recommendations while also understanding the rationale behind their investments.

The Oxford Income Letter is a suitable option for retirement investors, dividend investors, or investors who want to diversify a growth/momentum portfolio with some “safer” stock picks.

On top of that, the service is priced fairly at $79/year for premium, which is definitely on the lower end when compared to other advisory services.

Pros

• Relatively inexpensive subscription
• Four types of portfolios for income over time
• Mix of stock and bond investments
• Easy to keep track of portfolio returns
• Invests in high-yield dividend stocks for instant income

Cons

• Not all stocks come with stop loss recommendations
• Mixed performance record