Author Archive: Brett Owens

With the Trump bump squeezing stocks higher, retirees (and near-retirees) are asking me two questions a lot these days:

Is it still a good time to buy? And if so, what the heck should I buy?

The answer to the first is, undoubtedly, yes.

And it’s no secret what’s behind the second: according to FactSet, this market is trading at a forward price-to-earnings (P/E) ratio that hasn’t been seen in 13 years.

Investors Double Down

Source: FactSet

No wonder folks are struggling with what to buy!

One thing I recommend avoiding now is an index fund like the SPDR S&P 500 ETF (SPY).… Read more

Tax season can be a cringe-inducing affair for most investors, who have to fill out their 1040s, 1099s and K-1s with Uncle Sam hovering above, looking for his cut. But for investors who have bought into one of the five high-yielding funds I want to share with you today, this time of year is a friendly reminder of the greatness of municipal bonds and their fat, tax-free yields.

Most investors have money stashed away in bonds of some sort. Often, those bonds will be U.S. Treasury bills (debt issued by the federal government), though frequently, investors will have some exposure to corporate bonds (debt issued by companies).… Read more

Most investors buy stocks and hope they’ll go up in price. They do nothing in the interim to generate cash flow from those stocks while they sit in their portfolio – like writing covered calls.

“Write” what?

I’ll explain. And I’ll also highlight some popular exchange-traded funds (ETFs) and closed-end funds (CEFs) that will help you generate 8% yields or better from this income strategy without actually handling an options contract yourself.

A call option is a contract that gives its buyer the right to purchase a stock from the seller for a certain price within a certain period of time.… Read more

Today we’re going to head out to one of my favorite hunting grounds for cheap high-yield stocks: the midcap space.

“Wait,” you may be thinking. “Haven’t midcap stocks been on a tear? How can there be any bargains left?”

You’d be right about the first part … but not the second.

To get at why, let’s look at how the benchmark S&P MidCap 400 ETF (MDY) has performed vs. its large-cap cousin, the SPDR S&P 500 ETF (SPY) in the past year:

Midcaps Soar…

That rise has had a predictable effect on both funds’ dividend yields (because you calculate yield by dividing the annual dividend into the current share price):

…While Yields Shrink

I know—this still doesn’t make midcaps look like an ideal spot to find bargain high-yielders, but hear me out.… Read more

I get it – you want a diversified portfolio that lets you live off dividends alone. And you probably don’t want to spend most of your waking hours worrying about a million tickers either.

Consider exchange-traded funds (ETFs) then, which provide your portfolio with instant diversification through a single purchase. Pick a strategy you like (ie. high yield) and let the fund do the work for you.

Today we’ll highlight five dirt-cheap ETFs that distribute loads of cash … and let you walk away with the lion’s share of income. Now you and I both know that high fees rob you of returns.… Read more

The technology sector has long been the growth investor’s best friend, with tomorrow’s innovations fueling the breakneck gains necessary to generate big price returns. Traditionally there hasn’t been much to interest us dividend investors – until now.

Some tech companies have finally grown up. And while their profit growth has slowed, their shareholder returns have actually accelerated. These companies literally make more money than they know what to do with – so they are increasingly dishing it back as dividends.

Here are five tech titans with big cash flows paying yields up to 6%.

Qualcomm (QCOM)
Dividend Yield: 4%

Qualcomm (QCOM) has wandered its way back into 4% yield territory, but right now, the wireless technology specialist is in extremely choppy waters.… Read more

The classic “Dogs of the Dow” strategy advises buying the 10 highest-yielding Dow Jones Industrial Average stocks, then holding onto them for a year. The idea is that higher yields are a signal of a beaten-up share price – and that because we’re buying a stable blue-chip with a stable customer base, investors will eventually bid the stock back up when the business cycle turns up again.

But we can further improve on this effective yet somewhat “dumb” strategy with a bit of second-level analysis. After all, some of these companies have business models that are actually aging in dog years!… Read more

A few weeks ago we discussed how you can make 12% annually, forever, from stocks. Now let’s apply those lessons to 2017, and highlight five that should do even better (17%+ returns) this year (and likely beyond).

Remember, projecting our returns from any given stock is simple. We simply add together the three ways it can pay us:

1. Its current dividend.
2. A future dividend hike.
3. Share repurchases.

It also helps if the stock is inexpensive, as buybacks deliver more bang for management’s buck. So let’s stick with stocks that are dirt-cheap, trading for 10-times free cash flow (FCF) or less for this exercise.… Read more