Covered-call funds give us something we demand at a time like this: outsized 8%+ payouts!

And the last few months have shown us something else: These funds work—especially when you use them in a specific kind of market (hint: conditions just like those we’re facing now).

Covered-Call Funds “Translate” Option Gains Into 8%+ Dividends

Even though the name sounds complicated, covered-call funds have a relatively straightforward setup behind them. They start by letting you hold a bundle of stocks, just like, say, an ETF would. In the case of the covered-call fund we’ll talk about today, the Nuveen S&P 500 Dynamic Overwrite Fund (SPXX), these are the companies in the S&P 500.… Read more

“How’s your hip?” my wife asked. The emphasis on hip was bearish for me as I limped from, well, you’ll see.

My gait had been good (dare I say normal?) for the last 10 days. She justifiably wondered what was up.

“The jog,” I mumbled. And shrugged.

“He cleared you to jog?”

Really, he did! Sort of. “Yes,” I replied confidently. “He said yesterday it was probably OK.”

I had just completed a three-week round of shots to calm down my hip osteoarthritis, but these treatments tend to rile up the joint before helping. So, my jog was… premature.

I had to admit: “I went a little fast.… Read more

One of our favorite pipeline plays—Enbridge (ENB)—has taken a tumble. It’s set up a sweet buying opportunity.

We can thank rising rates (with an “assist” from overdone trade war fears!) for this opening.

Here’s the state of play with this one, which I’ve nicknamed the “natty” king because, despite its Canadian domicile, it ships 20% of the natural gas consumed in the US.

• The stock yields a gaudy 5.6%.
• Enbridge is a “toll booth” on North American energy consumption, collecting fixed rates for the use of its pipelines and storage facilities, no matter what oil and gas prices do.

Usually in this space, we dig into 8%+ paying closed-end funds (CEFs) set to hand us strong returns and large income streams.

Today, we’re going to do something different and discuss a once-great fund that, sadly, is far past its glory days.

Why?

Because this fund highlights one of the dangers of high-yield investing. That would be the risk of getting too comfortable with a large payout—and ignoring the signs telling us it’s time to take our profits and walk away.

That’s not easy for those of us who invest for dividends! Especially when you have an income stream as big as the one this fund offers (a 12.7% annualized yield) rolling in.… Read more

Rate hikes are back on the table. For most investors, that’s bad news. But for shareholders in one high-yielding corner of the market, it could be the best thing that’s happened all year.

Own bonds? New issues get more attractive, so your existing ones lose value. Own stocks? Higher rates raise borrowing costs and make bonds more competitive with dividends. Neither is a great setup.

But business development companies (BDCs) have a more complicated relationship with interest rates. In fact, these high-single- and double-digit yielders could get a much-needed spark if Warsh & Co. green-light the first rate hike since 2023.… Read more

The numbers are starting to support something I’ve long argued about AI: Yes, this technology is shifting the job picture—but it’s not throwing millions out of work.

Instead, the economy is shifting.

The new story? While tech-sector jobs are being cut (temporarily, I believe), growth in other areas—including those that are employing AI to drive growth (and hiring along with it)—is flourishing.

Investors, however, still haven’t caught on. And an ongoing stream of dour headlines—from a “hot” war in Iran to a trade war with Canada—has distracted them further.

That’s set up an opportunity in high-yielding, equity-focused closed-end funds (CEFs) like the Liberty All-Star Equity Fund (USA), payer of a blockbuster 11.4% dividend.… Read more

Let’s discuss an investor who banks a $34,533 dividend check on the first of every month. From one fund alone!

Think you can survive on $34,000 in passive income per month, too? From just one position?

Of course you do. And right now, you and I can buy this monthly payer for a better price than the big shot! (Who, by the way, keeps working long days—not what many of us would do with a $34K monthly paycheck!)

I’m talking about Emmanuel “Manny” Roman, the CEO of PIMCO. Yes, that PIMCO, the most famous bond shop in the world. It was the old home of Bond King Bill Gross, who has since been deposed.… Read more

Is 2026 a replay of 2022? Plenty of bond investors think so.

But they’re wrong. And we’re happy to take the other side of the argument!

We’ll do that in the form of a closed-end fund (CEF) yielding a stout 10.3%—and sending that fat payout drip, drip, dripping into our accounts every month.

As we break down this overdone fear, I think you’ll see that it’s a classic example of “first-level” thinking. That’s another way of saying that the mainstream crowd is, as usual, making decisions based on the headlines and nothing more.

The “headline” in this case is the spike in 30-year Treasury yields, which recently broke over highs last seen in late 2023, after the Fed had had pumped rates from 0.25% in early 2022 to all the way up to 5.5%:

Treasury Rates Rise, Bond Holders Panic

That chart alone is enough to prompt first-level investors to dump bonds.… Read more

Look, we all know the old “truism” of investing: Want higher returns? You’d better be prepared to take on higher risk.

That’s not always true, however. In fact, sometimes markets do strange things, and a so-called “conservative” investment can turn around and deliver stunning returns. This is even more common in the world of closed-end funds (CEFs), where even stranger things can happen than in the “regular” stock world.

That’s in part because CEFs are a small market, so they tend to draw more individual investors, but fewer hedge funds and big banks. That can cause CEFs to overreact to some changes in the economy and markets and underreact to others, setting the stage for those strange moves I just mentioned.… Read more

Small-cap stocks have been so miserable for so long that even a healthy beating of their large-cap peers across 2026 hasn’t been enough to give them any buzz.

Good news for us, and anyone else looking for 6.7%-16.3% yields on the cheap.

It’s been a rough decade for the “junior mint” shelf of stocks! Mega-caps have been the flavor du jour. In fact, by the S&P 600’s count, small caps have only topped their big brothers once since 2016—and that was a “lesser loss” in 2022!

Wall Street is understandably skeptical that 2026’s outperformance is a sign of a bigger pivot.… Read more