Author Archive: Brett Owens

Get your dip-buying lists ready, because it’s almost time to pounce.

Just recently, I explained to investors that, as a contrarian, we only want to fully dive into the market when we have a clear edge—the kind of edge you get when Wall Street has fully capitulated:

“We only want to fully invest when the regular investor has thrown in the towel. And there are plenty of indicators that can tell us exactly when our time has come. Consider, for example, the closely watched CNN Fear/Greed Index, which sits at 26 as I write.”

That was just a week ago.… Read more

Attention, growth investors! A quick stock market question for you.

(Dividend people, you are welcome to play, too.)

Take a quick peek at the chart below. The lines are revenue gains over the past twelve months for four stocks.

Three of them are top holdings in ARK Innovation ETF (ARKK). The fourth, well, is a contrarian special that careful readers already know. (Hint, hint.)

Which sales curve would you want to own?

Pick Your Growth Stock

Did you peek at the key? Of course you did. Well, were you surprised that Exxon Mobil (XOM) was running laps around these three laggards?… Read more

Look, I know it’s heartbreaking to invest in this dumpster-fire market. Heck, even if you do everything right and only buy top-quality dividend stocks, they still seem to plunge a day (or two at most!) later.

This is why, in last Tuesday’s article (the first in a series on how my proven “Dividend Magnet” plan can boost your returns), I urged folks to keep a healthy cash pile to invest on the other side of this crash—and that time will come! I’ll tell you when we’ll fully deploy our hoard in my Hidden Yields dividend-growth service.

Meantime, we’ll continue to trade lightly—buying only in small lots and only for the long haul.… Read more

What’s better than a 9.3% dividend stock? How about one that’s poised to pop as interest rates rise?

Business development companies, or BDCs for short, are overlooked by most income investors. That’s too bad for them because these dividend deals can be pretty sweet.

Especially when rates are rising.

BDCs cut loans to small businesses. Their inflation-friendly component comes from floating rate loans. BDCs that lend this way make more money when rates rise.

BDCs came to life in 1980 when Congress whipped up these tax-advantaged entities. Like the REITs we all love, BDCs are cleared by Uncle Sam for tax-free profits, provided they dish most of their green as dividends.… Read more

Here’s some advice you might be surprised to hear from an investment-newsletter writer: Do NOT buy stocks right now.

That is, unless you can answer an emphatic “yes!” to these three questions:

1. Are you investing for the long term?
2. Are you investing in stocks that are not only growing their dividends but accelerating that payout growth?
3. Are you only investing a small portion of your holdings (and ideally keeping the bulk in cash to ride out this storm)?

If you answered yes to all three, great! I’ll show you what you must demand in any dividend grower to ensure you’re locking in a safe payout while protecting yourself from today’s Fed-driven market panic.… Read more

The point of a bear market is to bring price-to-earnings (P/E) ratios back down to earth. Preferably into single digits.

I like P/Es under ten because it means that the company at least has a chance to pay us back within a decade. Give me a P/E of eight, a business I’m comfortable with and I’ll happily wait the eight years.

Bonus points if I can get paid to wait, which is where dividend stocks come in.

Thanks to this unfolding bear market, we finally have discounts in High Yieldland. We recently chatted about five cash flowing bargains, and here in just a minute, we’ll discuss another five.… Read more

We’ve been extolling cash in these pages since the start of this year. As the Federal Reserve prepared to pause its money printer, we contrarians booked profits and stacked dollar bills.

Long before the media began saying “bear market,” we recognized that a volatile 2022 was highly likely. We were ready for a decline.

As I write, our premium portfolios are all sitting on sizeable cash positions:

Yup. Plenty of capital ready to be deployed after the final “wash out” in the markets.

These comfortable cash seats have served us well. Bonds kicked off their worst start to a year since 1788 (per Nasdaq).… Read more

In the current environment, with more downside likely to come, one of the best things you and I can do is nothing.

… or at least, next to nothing.

I recently wrote about the virtues of a “no beta” portfolio—basically holding on to cash until it’s time to “back up the truck” at a major market bottom.

But I left the door open—”if you must buy, please promise me you’ll keep it low beta. It’s the next best option to low-beta cash”—and for good reason.

The Case for Low Beta

“Anyone who studies finance learns early on that risk and reward go hand in hand and that with higher expected returns come higher risks.… Read more

The yield on the 10-year Treasury has rallied near 3%. Yet there’s no way you and I are retiring off that pittance!

Hence the appeal of closed-end funds (CEFs), which regularly pay 7% or better. That’s the difference between a paltry income below $30,000 on a million buck nest egg or a respectable $70,000 annually.

And if you’re smart about your CEF purchases, you can even buy these funds at discounts and snare some price upside to boot!

With the markets in flux (to say the least), now is a good time to review the principles of successful CEF investing. They are more nuanced than classic stock picking because we’re analyzing managers, strategies and holdings versus simple businesses models.… Read more

Most folks dread checking their retirement accounts these days, but not us contrarian income-seekers. We’re coolly playing our “no-withdrawal” retirement strategy, paying our bills with 7% to 9% dividends—while leaving our pile of saved cash alone.

I know that sounds pretty sanguine—boastful, even—when the S&P 500 is down nearly 20%. But deep down, most people know that a “dividends-only” retirement really is the best way to go.

Trouble is, most folks don’t know how to get there. I’ll lay out a roadmap that could let you hang ’em up on dividends alone with as little as $500K saved a little further on.… Read more