Author Archive: Brett Owens

What a time to be alive! The stock market is booming, and many of our favorite income investments are ticking higher every day.  Surely, they are reflecting the broader optimism that investors have about the US and the rest of the world.

Hold on a sec—my publisher is reminding me that the curfew in my town just lifted on Monday. Seven days of being home by 8pm, following two months of being told to shelter-in-place. As a friend of mine pointed out, we haven’t been double grounded like this since high school.

The news is usually a downer, but these days it’s tough to make it through the headlines without a handful of Xanax.… Read more

If you’re shopping for high-yield closed-end funds (CEFs), two numbers are critical:

• The dividend: There are about 500 CEFs out there, and they boast huge payouts of 7% on average. Many also pay monthly.

• The discount: Due to a quirk in the CEF structure, these funds often trade at discounts to the per-share value of their portfolios. Called the discount to net asset value (NAV), this indicator is the clearest indicator of imminent price gains I’ve ever seen in an investment.

A Proven Gain Predictor

Thanks to the discount to NAV—which is available on any fund screener—you literally have a CEF’s market price on a string!… Read more

Imagine investing a million dollars and getting back … a pathetic $19,000 in income every year.

You don’t have to imagine—because that’s exactly what you’d get if you bought the typical S&P 500 stock today, which yields a sad 1.9%. That’s not much and these days, you can lose that in one afternoon!

No wonder dividends get no respect!

But I’ve got good news: that 1.9% doesn’t matter a bit to us. In fact, it’s a distraction from the real opportunity I want to show you: a dead-simple, 3-step shot at a much bigger payout.

I’m talking about 6%+ in cash here.… Read more

“How fast should I deploy my cash into your dividend stocks?”

It’s a common question from the new income investors that are always finding their way to us (welcome!) We publish a plethora of dividend analysis on our website ContrarianOutlook.com. And, for premium subscribers, we also issue specific buy, hold and sell recommendations for select stocks and funds.

So, where should a new reader (or, better yet, premium subscriber!) start? Let’s walk through some steps you can take to make the best use of our information as you build your dividend-powered retirement portfolio.

First, Pick Your Stocks

Stock picking is step one, and as discussed, we have no shortage of dividend coverage around here.… Read more

I’m no mind reader, but I’m guessing you’d leap at an investment with the stability of a bond and the upside of a stock right now.

Sounds like something tailor-made for a crisis, right?

The good news is that it’s no pipe dream. These handy “crash-resistant” plays are out there and ripe for buying. We’re going to take a close look at how we can tap them for huge dividends now—yearly cash payouts all the way up to 9.7%!

It’s a retirement strategy every investor should take a look at. Unfortunately, too few even know these “shapeshifter” investments exist.

Lender Today, Shareholder Tomorrow

I’m talking about convertible bonds.… Read more

Have utility stocks been stripped of their safe-haven status?

I’ve fielded that question from a few readers who have rightly pointed out the utility sector’s unimpressive performance during 2020’s market rout and partial recovery.

The short answer? No, it hasn’t. At least not for those of us who look through short-term price jitters to lock-in long-term payouts.

Back in the “good old days,” utility stocks delivered enough income to actually retire on. And thanks to this once-in-a-decade panic, that’s the case once again. Even though utility stocks are well off their bottom, investors still can grab perfectly safe yields of up to 7% in the space.… Read more

Somehow, some way, the stock market continues to levitate higher. Yet I see very little that’s worth buying here.

We can’t argue with the tape. Markets will do their thing, while we must do ours. And today, it’s a good time to be cautious and prepare for the possibility of another sharp pullback. (The old “retest” of the lows that most investors expected until they were swept away by the allure of rising stock prices!)

Our dream shopping list, as we’ve discussed before, should contain some blue-chip dividend stocks. Nasty bear markets are the only time we can buy these names cheap!… Read more

Right now, millions of people are plowing cash into this market, gambling that the worst of the dividend cuts is behind us.

I hope you’re not one of them, because this “dividend trap” is likely to spring—and steal away the income (and value) these folks have spent years building!

Just look at the numbers: unemployment is likely over 20%. Consumer spending cratered 7.5% in March, before this mess even really got started. And now Uncle Sam is demanding that any company seeking government aid first send its payout to the scrapyard.

Meantime, even cash-rich companies are pulling in their horns, like the Walt Disney Co.… Read more

“It’s my money, and I want it now!”

That’s the rallying cry of everyday folks in commercials for J.G. Wentworth, a financial services firm that offers lump-sum cash payments for structured settlements, annuities, lottery payments and more. (If you’ve never seen one of these TV spots, I suggest you try one out. They’re so bad they’re good.)

Every income investor could (and probably should) take a cue from its motto. To quote another spot: “Show us the money!”

Monthly dividend stocks, of course, pay more often than any other income investment. Dividend checks coming in every 30 days are especially handy for retirees who have bills to pay.… Read more

“Brett, I didn’t sell (insert dividend stock here) in March. Should I hold my nose and sell now?”

If you sat on your hands during the March drop and subsequent bounce, you’re not alone. Many of your fellow income investors are still holding on to positions that they know they should probably sell, but haven’t yet. (I know this because I’ve heard this question from a number of you!)

Well, here’s the question I would ask you about the position:

“Is the business going to rebound to pre-pandemic levels any time soon?”

If the answer is “no” then why would you not sell the stock?… Read more