Author Archive: Brett Owens

If you don’t like these 8%, 9% and even 10%+ dividends, well, you’re not really an income investor.

That’s right. As I write, select closed-end funds (CEFs) yield 10.8%.

Ten. Point. Eight. Per. Cent!

We contrarians are locking in yields up to nearly 11%. When the market seas become choppy, we’ll stick to our script. Here it is, broken down in an 11-step playbook for these 8%, 9%, even 10.8% yields.

CEF Rule #1: Buy the Best 

Fixed-income behemoth DoubleLine runs some well-known big funds as well as smaller, lesser-known CEFs. There’s a raging dividend party in the ignored CEF corner of DoubleLine’s portfolio, with yields up to 10.8% via

DoubleLine Income Solutions Fund (DSL).… Read more

Let’s cut to the chase on dividend investing in 2024: our strategy this year will be all about interest rates.

Sure, there are other trends out there, like AI. And yep, there’s some steak behind the sizzle.

But when it comes to grabbing fast-growing—and high-yielding—payouts at the right times, rate moves will rule the roost. That’s not much of a surprise, really, as stocks have hung on Jay Powell’s every utterance for the last couple years.

But here’s the twist: Powell won’t be the headline-grabber in ’24. Look for him to fade into the background, with the Fed likely to move rates lower, maybe by a percent or so.… Read more

The 2024 Dogs of the Dow are particularly homely hounds—which means we’re talking big dividends.

This year’s Dogs yield more than three-times the broader market’s paltry payout. So, should we hold our noses and buy? Let’s grab some peanut butter treats and investigate. But first, a review of the “Dogs” strategy.

The “Dogs of the Dow” strategy means buying the Dow Jones Industrial Average’s laggards. It’s a simple three-step strategy that often outperforms in the year ahead:

• Step 1: After the final trading day of the year, identify the 10 highest-yielding stocks in the Dow.
• Step 2: Buy all 10 stocks in equal amounts and hold them for a year.

I don’t want to be the messenger of bearish news to kick off the new year. But, as a card-carrying contrarian, I can’t help it either.

We should sell our dicey dividends now. While the market is high.

The best time to buy was October, when vanilla investors were fearful. We discussed “backing up the truck” to buy anything and everything week after week after week.

CNN’s Fear and Greed Index (FGI) had bottomed out at 16 out of 100, an Extreme Fear reading only seen during stock market panics:

1 Rally and 3 Months Ago: Extreme Fear

Meanwhile the bastion of basic financial thinking, MarketWatch.com,… Read more

Let’s kick off 2024 with great news: despite the Santa Claus rally, there are still some sweet dividend deals on the board—many hiding in plain sight.

In a second, we’ll name names and dive into my 2024 outlook, including my forecast for a 2024 recession and exactly what we’re going to be looking for in dividend payers (and growers) this year.

First, let’s tee up 2024 by reviewing the game tape from the last quarter of ’23.

Buying Fear Drove Fast Double-Digit Gains in Late ’23

Readers of my Contrarian Income Report service will recognize the Gabelli Dividend & Income Trust (GDV), one of the picks we grabbed when panic was running high in October.… Read more

As we return Mariah Carey to the ocean depths for another year, we turn our attention to our next seasonal siren—double-digit dividend stocks.

They are, after all, the perfect way to retire on dividends, right? Put $500,000 in a portfolio of 10% payers and we’re looking at $50,000 in annual dividend income. Plus we get to keep our principal.

Right?

Not always. Most double-digit divvies are “cheap for a reason.” These are dogs dressed up as dividend payers. But the payouts are often in danger. Which means price stability is equally dicey. Which is why we often say no thanks to these mega-headline yields.… Read more

Raise your hand if you want to actively work for income in 2024.

(Please note your dividend strategist already has his pointer finger in the tip of his nose. Not it!)

Here at Contrarian Outlook, we prefer passive dividend income to active income, thank you very much. Because trading hours for dollars is, let’s just say it, such a drag.

A job? Tired. Dividends, meanwhile, are wired. Since ‘tis the season for resolutions, let’s discuss my top four to retire on dividends in 2024.

Dividend Resolution #1: Project Our Income

If you’re a serious dividend investor, I hope you took my advice last week and grabbed your risk-free trial to Income Calendar.… Read more

If there’s one thing we need to remember when we buy high-yield closed-end funds (CEFs), it’s this: always demand a discount.

Well, make that two: always demand a high dividend, too! Because CEFs are renowned for their high—and often monthly—payouts, with the average CEF yielding around 8% today.

But back to discounts. Luckily for us, they’re common with CEFs: of the 422 CEFs tracked by the CEF Connect screener, 384 trade at discounts to net asset value (NAV).

That’s a great place to start our search for top-notch CEFs, because these discounts are basically free money: they let us pick up, say, Mastercard (MA) for 85 cents on the dollar through a CEF like the Gabelli Dividend & Income Trust (GDV).… Read more

Select real estate may be the income investing play for 2024. As I write, seven real estate investment trusts (REITs) are dishing dividends from 8.7% all the way up to 15.4%.

These REITs—and their ilk—are literally designed to deliver dividends. That’s how Congress wrote the rules when they legislated these real estate investments into existence back in 1960.

REITs avoid taxes at the corporate level. But in exchange, they need to pony up at least 90% of their taxable income and redistribute it to investors as dividends.

As a result, our average REIT yields somewhere around 2x to 3x the market.… Read more

If you are a serious dividend investor, then you know the answer to this question:

How much dividend income are you going to make in 2024?

In other words, what are your projected dividends next year?

If you don’t know, then you’re not as dedicated to dividends as you thought. Disappointing, but fixable with Income Calendar.

And please, don’t tell me I’m being hard on you. If that’s the way you feel, then this is the tough love that you need. Your wakeup call for 2024.

It’s time to treat your dividend investing like a business. Because it is.… Read more