Author Archive: Brett Owens

As interest rates rise, the best defense will be a good offense. Research from Nuveen and Ned Davis confirms what we already knew – that dividend growth stocks outperform everyone else in the 36 months after a Fed rate increase:

Stock Returns After Fed Increases

That’s no surprise either, because payout growers always outpace their counterparts.

Everyone loves dividends, but dividend hikes are underappreciated. Not only do they increase the yield on your initial capital, but they often are reflected in a price increase for the stock.

For example, if a stock pays a 3% current yield and then hikes its payout by 10%, it’s unlikely that its stock price will stagnate for long.… Read more

Today, we’re going to highlight the four best retirement funds Vanguard has to offer. Since my favorite retirement fund closed its doors to new investors, I had to find more high quality, high income and low cost options for readers like you to consider.

The Vanguard Group is the top mutual fund provider by assets under management, boasting nearly $3 trillion across more than 125 mutual funds. And almost all of that is locked up in long-term assets — a statement about Vanguard’s elite standing among buy-and-hold retirement investors.

Vanguard doesn’t do leverage, it doesn’t do inverse. With very few exceptions, Vanguard’s funds aren’t trading instruments.… Read more

Income investors have mined just about every corner of the market for yield. Blue-chip dividend stalwarts like Microsoft (MSFT) and Exxon Mobil (XOM) are downright expensive at this point thanks to a growing crowd of yield hunters. Those seeking more substantial yields have guzzled the alphabet soup, jumping into REITs, MLPs, BDCs and CEFs.

To quote the Barenaked Ladies, “It’s all been done.”

But in my hunt for less appreciated sources of high yield, I’ve come across three stocks that the financial media barely discusses, and that most investors don’t even know about.

What really sticks out about these stocks isn’t just their yields – which range between 7% and 12%!… Read more

If you’re betting that President-elect Trump’s economic policies will ignite corporate profits—and share prices—I have two words for you: be careful.

In a moment, I’ll show you how I’m investing in the early days of the Trump era and name 3 rare finance-sector bargains that are terrific buys now.

First, let’s look at how much things have changed (and not) since Election Day, starting with the S&P 500, which has jumped 6.0%. However, most of that came in the first month: since December 8, it’s basically gone nowhere.

“Trump Bump” Hits a Wall

That leaves the market trading around 17.1 times forward earnings, according to FactSet, well above the five-year average of 15.1 and the 10-year average of 14.4.… Read more

Not every high yield asset is in danger as rates rise. While some stocks paying 3% may feel the Fed’s pressure, there’s a higher subset paying 8% that should do just fine.

If you’re looking for dividends you can actually retire on, you should familiarize yourself with business development companies (BDCs). They tend to pay big yields because they are required by law to dish most of their profits back to their investors as dividends.

BDCs themselves are investment companies that provide funding to small- and mid-size companies (which typically have a difficult time acquiring funding from larger financiers). BDCs were brought to life in 1980 by Congress to spur U.S.… Read more

“Efficient market” proponents are wrong – you can bank returns of 10%, 12% or more from stocks regularly.

But you need to ignore common Wall Street “wisdom” and follow a simple 3-step formula that I’ll outline for you in a moment.

Most individual investors don’t make anything close to 10% per year because they practice “buy and hope” investing. They pick up shares and root for them to appreciate in price. With no specific plan outlining how they are going to profit from their stocks, they are doomed.

Even “tangible” fundamental drivers like higher sales or profits are no guarantee that you will profit.… Read more