Is There Any Reason to Hold a CEF Paying Less Than 5%?

Brett Owens, Chief Investment Strategist
Updated: June 19, 2024

Only here at Contrarian Outlook can we banter for an hour-plus about closed-end funds, utilities and oil dividends! This site is our sanctuary, my income friends.

I’m talking about our Contrarian Outlook 2024 Q2 VIP Webcast. Every quarter we fire up GoToWebinar and discuss the top high-yield stocks and bonds on my mind, along with your questions. A big thanks to my 1,151 subscriber friends who attended the meeting live.

On the call I fielded some questions about closed-end funds (CEFs) that we didn’t have time to cover. I said I’d read them all and, well, I did. So, let’s address them now.… Read more

The “Electrify Everything” Trend Is Real: These Dividends Will Win Big

Brett Owens, Chief Investment Strategist
Updated: June 18, 2024

The media hype machine is in overdrive, pushing utility stocks as a savvy way to play AI’s growth. You’ve no doubt seen these headlines (or some of the hundreds of others like them):

  • “The Unlikely Stocks That Became a Hot Bet on AI” –The Wall Street Journal
  • “AI Could Drive a Natural Gas Boom as Power Companies Face Surging Electricity Demand” –CNBC
  • “Utility Stocks Could Be Headed for a Decade of Strong Growth, Driven by Data, AI” –Barron’s

Before we go further, let me say right off the hop that we contrarians never chase headlines—we’re always looking to buy value first and foremost—high-yielding stocks that are washed out, in other words.… Read more

The “Sleepy” 8%-Yielding Corner of the Market Is Finally Waking Up

Michael Foster, Investment Strategist
Updated: June 17, 2024

I’ve been covering closed-end funds (CEFs) for more than a decade. Through that time (and still today!) I’ve been shocked at how many people sleepwalk right past these incredible income plays, and the big dividends (and upside) they offer.

CEFs are publicly traded and highly regulated, like mutual funds or ETFs. The key difference? Big dividends! The 500 or so CEFs out there yield 8.4% on average, and they’ve historically have yielded 7%+.

They work by investing in the kinds of assets most of us own already—stocks, bonds and real estate mostly. They then hand out the resulting profits as dividends.… Read more

Bet on Small Businesses (And Get Paid 9%+ Every Year!)

Brett Owens, Chief Investment Strategist
Updated: June 14, 2024

These small business lenders trade publicly—and offer payouts between 10.5% and 13%.

You have our attention.

We’ll discuss three stocks in the space in a moment. First, let’s address why these companies exist.

When small businesses need cash, they typically don’t dial up their banks. Increasingly, they turn to a small subset of private equity-esque companies for help. These unique companies throw off double-digit yields and can often be found trading for less than they’re worth. Not bad when we’re talking dividends up to 13%!

My Favorite Way to Collect Big Checks From Small Businesses

Once upon a time, when small businesses held out their hands for much-needed growth capital, banks were the only game in town.… Read more

3 Funds (Yielding Up to 12.5%) Set to Soar as the Economy Downshifts

Michael Foster, Investment Strategist
Updated: June 13, 2024

At my CEF Insider service, we started 2024 expecting stocks to rise about 10% to 15% this year. Well, we’re well within that range now: the S&P 500 is up just under 14% in 2024, as of this writing.

And it’s only June! Which means that while stocks can keep going higher, we’ll likely see more dips as the market catches its breath.

We’ll use those dips to pick up our favorite 8%+ yielding closed-end funds (CEFs), of course. But we don’t have to wait around for our next dip-buying opportunity—I’ve got three bargain-priced bond funds for you to consider now, yielding up to 12.5%.… Read more

5 Steps to Turn $500K Into $39,965.51 Per Year

Brett Owens, Chief Investment Strategist
Updated: June 12, 2024

$500K can be enough money to retire on. Even as early as age 50!

The trick is to convert the pile of cash into cash flow that can pay the bills. I’m talking about $39,965.51 per year in dividend income on that nest egg, thanks to 8% average yields.

These are passive payouts that show up every quarter or, better yet, every month. Meanwhile, we keep that $500K nest egg intact. Or, better yet, grind that principal higher steadily and safely.

Got more in your retirement account? Cool—more monthly dividend income for you!

We’ll talk specific stocks, funds and yields in a moment.… Read more

This 8.1% Monthly Dividend Pays Us While We Sleep

Brett Owens, Chief Investment Strategist
Updated: June 11, 2024

When it comes right down to it, there are really only two ways to get rich:

  • Through your investments.
  • Through your labor.

Let me be clear that we aren’t fans of Option 2. A J-O-B? No thanks! We’re retired—or on our way to it.

Don’t worry. Your income strategist has you covered.

How to Retire on 8%+ Dividends That Roll in “Overnight”

If you’re like me, on your dividend “paydays”—a stock’s payable date, in other words—you wake up, grab a coffee, log into your investment account and immediately do something with that “work-free” income.

Pay your bills, reinvest, drop it into an emergency fund—whatever works for you.… Read more

The Coming “Collapse” of AI (and a 9.1% Dividend to Cash In)

Michael Foster, Investment Strategist
Updated: June 10, 2024

You probably remember the first time you heard about ChatGPT. The AI tool’s lifelike responses seemed like magic—so much so that people were debating whether generative AI tools like it were actually conscious.

Such a debate was honestly a bit silly, and it didn’t last long. But the idea that these large-language models were sentient proved how much AI can emotionally influence people.

Fast-forward to today and that response is much less starry-eyed. You’ve no doubt run across AI-created content and art on the Internet that is, frankly, terrible (not to mention glaringly obvious). That’s prompted outlets like The Wall Street Journal to tell us “The AI revolution is already losing steam” and compare the industry to the “biggest crashes of the first dot-com bubble.”… Read more

When Bonds Take Off, These “Preferred” Payers (Up to 9.4%) Should, Too

Brett Owens, Chief Investment Strategist
Updated: June 7, 2024

Is there anything better than a true bond bargain? I mean, feed me those monthly dividends with a side of price upside and I’ll never ask for anything more!

Gains from a bond fund? Yes, we contrarian income investors want it all. And we can have it when we buy funds yielding up to 9.4% at discounts up to 12%.

Mr. and Ms. Market are finally realizing that rates did not eclipse their 2023 highs. In fact, they appear to be putting in a lower high, which would be quite bullish for the bonds that Wall Street has been ironically panning all year:

Reality Check: Rates Still Lower Than Last Year

And what’s good for bonds is also good for one of my favorite income investments: the preferred stock.… Read more

This 8.9% Dividend Soared 178% (and It’s STILL Cheap)

Michael Foster, Investment Strategist
Updated: June 6, 2024

You may have noticed that since the pandemic, there’s been a somewhat perverse desire to make the economy look worse than it is.

Whether it’s concerns about a looming recession—the so-called “vibecession” we talked about last week—or worries that life is getting too expensive because of inflation, there’s a growing bias toward doom-and-gloom.

Plus, pessimistic people tend to sound serious—and for many pundits, parroting these arguments is easier than actually analyzing data.

At CEF Insider, we remain 100% data-driven, for the simple reason that it’s profitable. After all, the doom-and-gloom was at a fever pitch in late 2022, and we all know how stocks have done since.… Read more