The manic market has been dumping business development companies (BDCs) left and right. Let’s talk about a seven-stock BDC portfolio (yielding 13.5%!) that is poised to bounce back when sanity returns.

BDCs, which lend money to small businesses, are on the “outs” with the Wall Street suits after countless soft jobs reports. The spreadsheet jockeys fret about an unemployment-induced economic slowdown and miss the real story: small businesses are making more money than ever thanks to AI.

Here is what’s actually happening in the Main Street economy:

• Employers—especially nimble small business owners—are implementing AI to streamline and even run their operations.

Every year, the stock market has a theme. And I’ve got a pretty good idea of what 2026’s will be.

Simply this: If you buy stocks in the new year, your return will be zilch—at best—for a decade. Maybe more.

Why do I say that? Because the market’s price-to-earnings (P/E) ratio is high by historical standards.

Trouble is, most people are reading this popular indicator all wrong. That disconnect (and the fear it’s starting to cause, which could get worse in 2026) is setting up a nice short-term buying opportunity for us.

Valuation worries are being amplified by this chart from Apollo Global Management, which could easily become the poster child for fearful investors next year:

It comes from Apollo’s chief economist, Torsten Sløk, who notes that the estimated returns we should expect from the S&P 500 over the next decade are zero.… Read more

2026 is shaping up to be the best year for bond investors in many years. Washington wants rates down, housing up and borrowing cheap again.

This wish list is wildly bullish for bonds.

Fed Chair Jay Powell has delivered two rate cuts to end the year, with more to follow. Whether or not Powell personally delivers them doesn’t matter to us. Powell is on his way out. But the Fed show will go on, with a ringmaster ready to roll.

President Trump has confirmed his shortlist for the next Fed Chair is down to “The Two Kevins”: Kevin Hassett and Kevin Warsh.… Read more

Today I have a sweet dividend “double shot” for you: The first? A 2.8% payout set to grow thanks to AI—and take the stock price up with it.

The second gives you high payouts now, in the form of a monthly-paid 7.8% divvie that also looks set to head higher.

Both of these tickers are cheap. In fact, they (and the sector they’re in) could very well be the last bargains on the board as the bull runs into its fourth (!) year.

Pharma Goes From “Dead Money” to the Next AI Winner 

These two dividend plays are on sale because they’re often lumped in with drug stocks—a sector that’s lagged for years.… Read more

One thing I’ve always been astonished by is how fast a winning strategy (in investing and in life!) can suddenly slam into a wall—and start causing a lot of pain.

Consider, for example, the life of a mortgage banker in the 2000s: They made easy money for years, then the subprime-mortgage crisis threw them out of work overnight.

This happens in investing, too, which is why it’s always good to stay humble and well-diversified. Some high-yielding closed-end funds (CEFs), for example, look like big winners at any given moment. But if you buy without looking under the hood, you’re risking sharp losses.… Read more

Covered-call strategies can be an income investors’ best friend. Whether the broader stock market goes up, down or merely grinds sideways, selling covered calls pays.

Fortunately, we can buy covered-call funds that do the heavy lifting (“call writing”) for us. These funds yield 7%, 12% and yes even 89%. We simply buy them and collect the dividends.

But are all covered-call funds good buys? Of course not. We’ll sort through a popular four-pack in a moment. First, let’s discuss what covered calls are and how they generate income.

Degenerate traders love buying call options to make big bets on stocks.… Read more

Today we’re going to talk about a subject that might seem a little outside the dividend plays we normally discuss.

But as you’ll see, this topic—a big shift in how Americans feel—is the main reason why some of our favorite high-yielding closed-end funds (CEFs) are woefully underpriced, like one equity-focused 9%-yielder with an incredible track record.

Let’s start with that unlikely topic: Happiness. It matters because, as we’ll see, how happy Americans are ties directly into investing behavior in very predictable ways.

Source: CEF Insider

This chart shows the results of the General Social Survey, from the University of Chicago’s National Opinion Research Center.… Read more

Is your portfolio on track to yield 26% in 2026?

If not, why not?

Of course, most stocks and funds don’t pay 26% on their own. But it’s a quick fix to get many of them to.

This makes a big difference to our retirement goals: a 26% return on a million-dollar portfolio is $260,000 in cash flow per year! Without tapping the principal.

Or $130,000 in cash flow on $500K. You get the idea. With 26% coming in, it’s a lot easier to retire.

How can we boost our investment income like this? Let’s take boring ol’ SPY—SPDR S&P 500 ETF Trust (SPY)—as our first example.… Read more

Investors are scared—and that’s setting up a terrific opportunity for us in 8%+ yielding covered-call CEFs.

That’s because volatility fuels the income these stout funds get from their option strategies. And that income flows right into our dividend checks.

I’ve got two 8%+ payers delivering growing “option-boosted” dividends for you below.

And thanks to the market’s relative calm these last few months, these funds are bargains. But the last four years of history say we’re likely headed into a storm. That’s because three of those years started with stocks tripping over their shoelaces.

I think 2026 will make it four out of five.… Read more

The bankruptcy of auto-parts supplier First Brands has hit a corner of the market known for high dividends. Does that make these assets bargains?

Maybe. But we need to be careful here, and avoid making the mistake of “reaching for yield”: that is, buying yields that are high for a reason: the stock price has plunged.

But I’m getting ahead of myself. The corner of the market I’m talking about is business development companies (BDCs), which loan money to small- and mid-sized firms.

Investors first got worried about BDCs a couple months ago, when the First Brands story broke. The news raised alarm about the private-credit market (where BDCs operate).… Read more