Author Archive: Brett Owens

These days, we contrarian income seekers are following a simple rule: “trade lightly.” Truth is, we saw this mess coming. It’s why we started lightening up our positions in my Contrarian Income Report service back in November.

In so doing, we’ve locked in some very nice returns, like 90% on chemical maker Chemours Co (CC); 44% on blue-chip-focused closed-end fund (CEF) Gabelli Dividend Trust (GDV); and 98% on the PIMCO Dynamic Income Fund (PDI—formerly PCI).

We didn’t sell any of these dividend payers because something was wrong with them—far from it!

They’d simply ridden Jay Powell’s cheap-money wave as far as they could.… Read more

Every legendary investor worth their salt has some sort of phrase to describe what investors should be doing right this very minute.

“Be fearful when others are greedy, be greedy when others are fearful.”

“Buy when there’s blood in the streets.”

Largely speaking, most stocks on the market are on sale to some extent. And sure, we could go out and make a few targeted bets on these bargains.

But I’d prefer to squeeze even more value out of the stock market.

Enter closed-end funds (CEFs).

Why CEFs Are Our Best Option Now

If we were to go out and buy an exchange-traded fund (ETF) that invests in, say, the Nasdaq Composite or Russell 2000, or really any area of the market you felt was underpriced, you’d be able to enjoy in the collective discounts of all their holdings.… Read more

The stock market keeps falling and falling because, for the first time in 14 years, there is nobody there to catch it.

The “Fed put” has expired.

The genesis of the Federal Reserve’s implicit put—the notion that the Fed will fix any decline—was the 2008 Financial Crisis. The financial system was on the ropes and the stock market itself became “too big to fail” as far as the Fed was concerned. Then-Chairman Ben Bernanke printed a bunch of money, boosted the market and was heralded a financial hero.

Since then, the Fed has been reluctant to let the stock market drop.… Read more

The retirement-income battle never ends! In 2020 and 2021, we were terrified of dividend cuts. Now we’re sweating soaring inflation!

The good news? No matter what the worry, we can apply my “2-step retirement income plan.” It’s designed to keep anything Jay Powell, Vladimir Putin or even Chinese President Xi does from impacting our dividend streams.

(Below I’ll give you two tickers that work perfectly with this strategy, including one that profits from the demise of Russian oil. This unsung company just hiked its payout 50%.)

Inflation Sideswipes Retirees

Of course, this market crash is mainly the work of Powell, who overshot the mark on stimulus, boosting the money supply by a ridiculous 40% since February 2020.… Read more

Mid-cap dividend stocks are the best bargain on the board right now. I love them because lame income investors don’t consider them. They fixate on:

• Large-cap stocks: For dividend safety.
• Small-cap stocks: For dividend growth.

Meanwhile many great under-the-radar mid-cap stocks sit between $2 billion and $10 billion in market capitalization. They sit in a “sweet spot” that accommodates dividend safety and growth.

Which is why they generate big returns.

Touchstone Investments reports that, when looking at 20-year rolling returns, mid-caps have experienced “typically higher absolute returns during the last 42 years”:

Source: Touchstone Investments

It’s easy to overlook these names—the media doesn’t talk about them as much, and they tend to have far less analyst coverage than the Apples (AAPL) and Microsofts (MSFT) of the world.… Read more

In bull markets, we buy the dips. In bear markets, we sell the rips.

Starting in spring 2020 and through 2021, we dividend investors stayed in “buy the dip” mode. Granted, 2020 seemed like a strange time to want to invest. But the Federal Reserve had our backs.

Heck, Fed insiders knew it. In late February 2020, Vice Chair Richard Clarida sold $1+ million in stock shares—and bought them a few days later on the eve of a certain “central bank announcement.”

The proclamation? That the Fed was prepared to print as much money as it needed to! In order to float the stock market (ha!)… Read more

Let’s not fall in love with our dividend stocks—as this can be a big mistake in a dumpster-fire year like 2022. We must be ready to toss “paper” payer tigers out and move into safe dividends poised to “front run” the next big market shift.

(I’ve got three tickers that are smart plays to swing into now, with yields up to 8.4% and payouts that have surged up to 55% in the last five years, taking their share prices along for the ride.)

“Buy-and-Hopers” Get Crushed

Before we go further, let’s take a moment to keep “buy and hold” investors in our thoughts—or as I like to call them, “buy and hope” investors, who sit tight for years, usually in an index fund, hoping for gains.… Read more

One of the market’s most secure, steady sources of generous yield is going through a rare turbulent moment. But these 7% to 8% yields—paid monthly, no less!—are selling at discounted prices we only see once every five years or so.

Is it time for us contrarians to consider “backing up the truck” to load up on these monthly dividend machines?

Why “Preferred” Dividends are This Cheap

“Preferred” stocks are stock-bond hybrids that rarely make Wall Street’s highlight reels. We like it that way, because these funds pay.

These underappreciated secrets don’t usually suffer this bad, either.

You Rarely See Preferreds Get Clobbered This Bad

The reason preferreds are usually so steady is that they simply collect income.… Read more

For decades, plain vanilla financial advisors have pitched a “4% withdrawal rate” as a retirement solution. Most were lazily stealing this advice from the smart, thrifty fellow who created the rule.

The 4% idea is that someone with, say, a million-dollar nest egg could safely withdraw $40,000 per year and probably not run out of money before they die. Or, at least, have it last for 33 years.

(And oh, by the way, they’d better hope that the financial poem keeps rhyming with a previous 50-year period. But I digress…)

Not the most inspiring idea, I know. So why are we even talking about this today?… Read more

Think back just four months: first-level investors were babbling on about “transitory” inflation and clambering for crypto and profitless tech stocks.

No more! The world has shifted. Russia’s war on Ukraine—a disaster on a human level first and foremost—has upended, well, everything.

Crappy crypto and bankruptcy-bound techs are out—and secure payers that benefit from today’s trends are in. (I’ve got three examples for you below, one of which has boosted its payout 119% in just the last five years.)

Secure Payers Thrive in a Volatile World

Let’s be honest: the Fed, Putin and President Xi of China are driving the market now.… Read more