Author Archive: Brett Owens

Investors are dumping top dividend growers. And they’re doing it at the worst possible time.

This is the kind of moment we contrarians live for: When investors look at short-term worries and panic—and forget the longer-term (and much rosier!) setup before them.

This is the basis of the old market adage that “Stocks climb a wall of worry.”

They do—and we’re here for it.

I’ve got two dividends for you below: one that’s taken too heavy a beating, and another that’s overlooked but just starting to get on the crowd’s radar. Its surging dividend (up 358% in the last decade) sure helps.… Read more

Getting antsy about the midterms? Wondering whether oil will ever come back down? Afraid the AI bubble is going to pop, blowing a dotcom-sized hole into your retirement portfolio?

I’m not. Because I’ve found the best cure for headline risk is a fat income check—preferably one that arrives every month.

The headline risks I mentioned are really starting to eat away at investors big and small. The VIX volatility index just spiked to multimonth highs. Hedge funds have been unloading their tech holdings at the fastest rate in a decade. Even though the major indices are just a percent or two off their highs, breadth has been terrible and small caps are actually in a correction.… Read more

The nervous types are being chased out of Bondland. Fear! Higher rates forever!

Well, no, not likely. Bonds have a “killer feature” for income investors. When their prices drop, their yields rise. We can then snag better deals and secure more dividends for our dollar. That is, if we have the smarts and guts to buy low.

Not everyone does, by the way! Few vanilla investors are taking advantage of the bond bargains right now. They are applying a different approach—panicking.

This is reflected in the MOVE index, which is the VIX (stock market volatility index) equivalent for bonds.… Read more

We love it when a stock “pays us back” in dividends. The faster, the better!

Most people don’t get this luxury. They’re stuck “grinding it out” with the S&P 500’s 1% payers.

Not us. We’re hunting for dividends big enough to let us retire on our payouts alone. We’re talking 7%, 8% and larger divvies.

Two high-payers leap to mind here—and not only because of their rich payouts: the JPMorgan Equity Premium Income ETF (JEPI) and the Global X S&P 500 Covered Call ETF (XYLD).

We like both because they let us create a “synthetic” yield on our paltry S&P 500 dividends: 7.2% from JEPI, and 8.5% for XYLD.… Read more

For a while, utilities were that sneaky play on AI. A picks-and-shovels provider, if you will.

Here’s why: AI usage is booming. What does AI use? It uses energy. AI is a notable energy hog, so the local utility company was the sneaky early beneficiary. Power prices would go up with more demand from that new data center down the street, and it was another customer for this utility’s captive audience.

Now things have changed a bit. Everyone publicly hates data centers:

Source: Economist/YouGov

What does it mean when poll numbers like this happen? It means everyone who’s left to sell utilities has already sold.… Read more

Yeah, we’re here for the dividends. But isn’t it nice when we buy a stock and it goes up, like, right away?

And it happens for us. We are contrarians! We buy payers when they are out of favor because that maximizes our yield (more dividends per dollar!) and minimizes our downside (everyone has already sold!).

Sometimes this works and we buy, say, a 6% dividend stock that quickly gains 10%. The hated setup gave us a quick paper buck. Cool—but now what do we do?

Well, we need to understand that a dividend acts like an anchor in both directions.… Read more

This year, Christmas (for dividend investors!) is set to arrive two months early.

Our gift?

A chance to grab our favorite high yielders—closed-end funds (CEFs) paying 10% and more—on an early “year-end” sale.

How cheap are we talking here? How about 90 cents on the dollar? In some cases less.

We’ve got an early start to the year-end tax-loss selling season to thank for this opportunity.

Forget Year-End: The Best Dividend Deals Are Right Now

Our play starts with the fact that CEFs are a small market, with only around 365 out there. That means they’re mainly held by individual investors, since most CEFs aren’t big enough to move the needle for the big guys.… Read more

Is there anything better than a closed-end fund (CEF) paying 7% or more in dividends? I’ll tell you what: it’s when that fund is discounted by 10% or more with respect to the fair value of its portfolio. This is a feature, a fantastic one, of CEFs: they tend to trade at discounts to their fair values.

Why do CEF values wander from the underlying value of their portfolios? It’s because these vehicles issue fixed amounts of shares, so when investors are greedy, they can bid up the prices of these funds in excess of their net asset values, or NAVs.… Read more

“He hasn’t picked up a basketball since…” My fellow dad winced slightly, and I completed the sentence for him.

“Since last season.”

He shrugged.

“I get it,” I admitted. “He’s a seasonal hooper.”

My friend’s son has a body built for basketball. Tall. Loooooong arms.

He’s athletic, too. There’s just one thing holding him back: He doesn’t actually care about the sport of basketball. I know this because I’ve coached him (let’s call him Seasonal) since he was seven.

Every November, Seasonal shows up with his friends. He puts forth a somewhere-between-minimal-and-reasonable effort in practices. In games he has more fun and works harder.… Read more

It’s an app only Silicon Valley could come up with.

One of its key selling points? It can help users root out the monthly subscriptions they signed up for and forgot about—and cancel them.

I’m talking about Muse, the AI agent Meta Platforms (META) launched last month. While Muse offers a free version (with a usage limit), it also offers—get this—a paid monthly plan.

Which raises the question: If you don’t use it enough, will Muse suggest canceling itself?

Not likely.

But that didn’t stop the (reliably) skittish mainstream crowd from doing what they always seem to when the threat of AI disruption rears its head: sell.… Read more