2 BDCs to Buy Now and An 11% Payer to Avoid at All Costs

David Peltier, Senior Investment Analyst
Updated: October 19, 2018

Do you want to generate income that increases along with interest rates, with the potential upside from private equity investments? A Business Development Company (BDC), a type of closed-end investment company, could be the answer you’re looking for.

BDCs were created by the U.S. Congress back in 1980, as a way to help small- and mid-size businesses grow. They invest in debt and/or equity and often provide operational assistance to the internal management team. Similar to real estate investment trusts (REITs), a BDC distributes at least 90% of its profits as dividends.

It’s the dividends that really make BDCs stand out in this rising interest rate environment, especially since trading volatility has spiked of late.… Read more

Your Contrarian Guide to Post-Selloff Profits (and 7.5% Dividends)

Michael Foster, Investment Strategist
Updated: October 18, 2018

With the stock market collapsing 6% from its all-time high in just two weeks, a lot of people are freaking out.

Don’t follow them!

Because now is the best time to buy we’ve seen in a long time.

Before I show you my top 3 “buy now” indicators—which are all blaring green—and a bargain 7.5%-yielder to jump on now, let me first say that we’ve been here before.

In mid-February, with the market again on its back, I urged readers not to panic. This has happened since:

A Quick Recovery

While a 1.6% total return in 8 months isn’t much to write home about, it’s not the massive loss a lot of investors are terrified of today.… Read more

There Are 17 Better Plays (Paying 7.5%) Than These 998 Bonds

Brett Owens, Chief Investment Strategist
Updated: October 17, 2018

How’s your bond portfolio doing? It should be a rock of stability right now.

Of course we may need to look past prices, which can swing wildly, and focus on net asset values and income, which are more reliable anchors.

For example I’ve been hearing from readers who were concerned that our excellent PIMCO Dynamic Credit and Mortgage Fund (PCI) isn’t “acting well.” Its price has whipsawed around this year, mostly in our favor. But lately it’s pulled back amidst the broader market drama and subscribers are worried the market “knows something” that we don’t.

Let’s put this price volatility in perspective.… Read more

Your Post-Crash Action Plan for 600% Dividend Growth

Brett Owens, Chief Investment Strategist
Updated: October 16, 2018

If you’re wondering what to do in this panicky market, I’ve got a few “get rich quick” words for you: buy cheap, high-quality dividend growers with both hands.

I know that’s easy to say, but overcoming fear is vital, because history proves it’s the path to serious wealth. I can show you why in 2 charts. Here’s the first one:

A Snapshot of Terror

This is the CBOE’s S&P 500 Volatility Index, which captures panic in a picture, spiking when the market tanks and dozing off when markets gently rise. When you overlay the VIX with the market’s ups and downs, a can’t-miss pattern emerges: folks who “bought terror” have ridden every dip to big gains!… Read more

Here’s My No. 1 Stock Market Prediction (and a 7.2% dividend to buy now)

Michael Foster, Investment Strategist
Updated: October 15, 2018

A game-changing story about stocks just broke—and you almost certainly missed it.

That’s why I’m writing about this surprising news today: because it’s just what you need to know if you’re struggling with how to approach this interest rate–obsessed market, especially in the wake of the recent pullback.

Why haven’t you heard it?

Because good news like this doesn’t grab as much attention as Chicken Little panic articles, so the financial press skips it. But what I’m about to tell you is crucial to your financial well-being—and something I’ve been saying on Contrarian Outlook and in our CEF Insider service for months now.… Read more

5 Blue Chip Dividends That Are Doomed

Brett Owens, Chief Investment Strategist
Updated: October 13, 2018

Even legends can lose their edge. This applies to acclaimed investors and dividend aristocrats alike.

2018 was an explosive news year that will be remembered for many reasons. But one thing that will go under the radar is how this year has been a turning point for numerous old-guard dividend stocks. These companies have been no-brainer holdings in countless retirement portfolios for years – in fact, chances are you hold one if not several of them.

I’m going to highlight five of these revered but poorly aging blue chips in a minute. But first, I want to show you the danger of avoiding warning signs, even in legendary investments.… Read more

2 Dicey Dividends that Could Spell Disaster for Your Portfolio

David Peltier, Senior Investment Analyst
Updated: October 12, 2018

One of the best characteristics about dividends is they usually offer a consistent, preferably growing stream of income. However, investors can easily fall into the trap of becoming complacent that future payments will continue to flow in, even when the business isn’t generating enough cash to fund the dividend.

The higher the yield being offered generally means the riskier the dividend is and sometimes losses can outweigh the expected income. For example, Dynagas LNG Partners (DLNG) cut its 16% yield back in April and shares are down 16% since.

It’s very tempting to reach for higher yielding stocks, especially when the 10-year government bond is at a seven-year high and north of 3.2%.… Read more

A “Rinse and Repeat” Trade for 40% Annualized Gains

Michael Foster, Investment Strategist
Updated: October 11, 2018

Today I’m going to show you a quick trade you can repeat over and over for an 8% gain in just over 2 months (or 40% annualized!).

How do I know?

Because this is exactly what happened with the PIMCO Global StocksPlus & Income Fund (PGP), which I urged Contrarian Outlook readers to buy in June and then sell in August.

A Fast, Easy Gain

So how was this win so easy to call the last time around, and how can we ride PGP and other funds to the same—and even bigger—gains in the future?

Let’s start at the beginning.… Read more

These 1-Click “Dividend Machines” Yield 8.8% with 56% Upside

Brett Owens, Chief Investment Strategist
Updated: October 10, 2018

Certain closed-end fund (CEF) investors are getting a little desperate for dividends. It’s tough to blame them for reaching for 5%, 6% and even 7%+ yields in a 2% to 3% world.

But by grossly overpaying for funds, they are risking too much capital to bank these payouts. If you own any of the five popular funds I’m about to call out, you should consider selling them immediately.

(There are bargain replacements, after all. I’m talking about funds trading as cheap as $0.88 on the dollar and yielding 7.2%. We’ll discuss specifics in a moment.)

“First-level” income seekers can be greedy one minute and fearful the next.… Read more

3 Imminent Special Dividends Ripe for Buying Now (yields up to 9.7%)

Brett Owens, Chief Investment Strategist
Updated: October 9, 2018

If you want to double—or even triple—your dividend income overnight, there’s an easy way to do it: buy stocks that pay special dividends.

And today I’ve got 3 totally ignored special-dividend payers for you. Each of these top-notch income plays throws off “hidden” payouts yielding up to 9.7%!

We’ll unmask all 3 as we roll through this article. We’ll also look at the almost comical reason why stocks like these get completely overlooked, and I’ll give you everything you need to get in on the next big special payout before it drops.

A $2-Trillion Cash Stash Looking for a Home

It happens like clockwork: a company announces a blowout quarter or a hike in its regular payout … and rolls out a big special dividend either days before or just after.… Read more