Author Archive: Michael Foster

Don’t lament the lack of a Santa Claus rally this year, because it comes with a bright silver lining: we dividend investors have more time to pick up big yields on the cheap.

Here’s why: America’s economy is still growing, with analysts booking forecasts for 3.7% earnings growth in the fourth quarter of 2022. What’s more, sales for S&P 500 companies are up 10%, and earnings have been rising all year.

Yet the market is still downbeat.

In other words, share prices are divorced from reality, and it’s only a matter of time before they correct. However, given the year we’ve had, it could still be a while before investors develop an appetite for stocks again.… Read more

If you made money investing in oil this year, congratulations! But I have a warning: now is the time to take profits—especially if you hold the two oil funds we’ll discuss below.

Before we get to those, let’s talk a little more about oil’s big year. If you bought earlier in 2022, you managed to pick up on the only sector in the green this year—and well into the green, too: the Energy Select Sector SPDR ETF (XLE), a good benchmark for oil stocks, has climbed 55% so far in 2022, while the S&P 500 has headed the other way, dropping some 20%.… Read more

Today we’re going to delve into a powerful strategy that can “convert” the bounce we’re seeing in the bond markets into a cool $100K income stream in retirement.

Best of all, this simple approach can help you do this without touching a penny of your nest egg.

Obviously, doing this with a savings account is impossible; as per the chart below, you’d need $10 million to produce that yearly $100K if your account earns 1%. And we all know that most savings accounts offer far less these days.

Source: CEF Insider

The key, then, is to push our yield higher while managing risk.… Read more

Good news: this dreadful year has created the conditions for a nice market bounce in 2023. And we CEF investors are in a nice position to capitalize with 9.8% dividends and potential 38%+ total returns next year.

I’ll name three closed-end funds (CEFs) with discounts big enough to deliver that potential 38%+ gain below. All they need to do is return to their “normal” valuations, and chip in just a touch of upside from their portfolios, too.

For starters, though, I’ll tell you that 9.8% is the average yield on the portfolio of my CEF Insider service. And that’s just the average.… Read more

We’ve got plenty of high-quality dividends on the table as we roll into 2023. Some of the best? Closed-end funds (CEFs) yielding north of 7.5%. Three specific names and tickers are coming up for you below.

I mention quality because if 2022 has showed us anything, it’s that quality matters: crypto and profitless tech got clobbered this year, and that was no one-off. With interest rates rising, these gambles—I say “gambles” because buying these was always more like a trip to the slot machines than investing—are likely down for the count.

You can see this in the performance of the NASDAQ 100, which is down some 28% year to date, as well-run, high-cash-flow companies like Apple (AAPL) and Microsoft (MSFT) were dragged down by basket cases like Meta Platforms (META) and its money-bleeding investments in the metaverse.… Read more

There’s almost certainly a recession on the way, and we closed-end fund (CEF) investors have a big edge over mainstream investors.

That edge is our high, reliable (and often monthly) CEF dividends. Thanks to those mighty payouts (the average yield on our CEF Insider service’s portfolio is 9.9% today), we can bide our time, collect our dividends and buy bargain-priced CEFs on the dips.

In fact, we don’t have to wait long: I’ll give you a conservative CEF pick to consider below that yields 9%, holds oversold large cap tech stocks, like Microsoft (MSFT) and Apple (AAPL), and is a bargain, to boot.… Read more

Rising rates have sunk bond prices—and sent their yields higher.

The upshot? Now is a good time to add high-quality corporate bonds to your portfolio. And if you do so through one closed-end fund (CEF) we’ll name in a second, you’ll be able to do so with a 13.4% dividend that grows.

To be honest, bonds have already started to rise, and we’ve been taking advantage in my CEF Insider service. In October, for example, we picked up the Nuveen Core Plus Impact Fund (NPCT), which yields 11.3% today. We’ve grabbed a 6.8% return so far, including one dividend payout of 10 cents a share.… Read more

Let’s be honest: after the year we’ve just put in, we’re all exhausted. But we can’t let our guard down. Because at times like these, it’s easy to let alarmist headlines skew our buy and sell decisions.

Worse, the clamor, and almost always incorrect market predictions that dominate the news these days, can lure you away from the reliable dividend payers you need to fund your retirement.

I hate to see that happen to investors—especially when they could easily use high-yield closed-end funds (CEFs) to retire on dividends alone. I’ve got three “low-drama” CEFs that can get you there, thanks to their outsized 8.1% average yield.… Read more

What if I told you there was a way for you to get a steady 9% dividend tax-free?

My guess is you’d be interested, especially after the tough year we’ve endured. Sure, 2023 is looking better, but no one knows what’s coming our way when it comes to inflation and rates, so more volatility is pretty much guaranteed. So a steady payout, especially sans taxes, could be the perfect fit for your portfolio.

Many investors’ response to the past year has been to go to cash. And while that may help avoid losses, it also puts you in the path of inflation running near 8%.… Read more

We’re in one of the trickiest times I’ve seen in my investing career: inflation is receding and we’re well positioned for gains next year. Yet after the year we’ve had, many folks are still hesitant to jump into the market.

Even the 12%+ dividends we’re seeing in our favorite high-yield investments, closed-end funds (CEFs) haven’t been enough to tempt many of them.

I get it.

This period reminds me of the early months of 2009, when “green shoots” were appearing in the economy and markets, but investors were still too scarred by the preceding plunge to get in. But those who did buy then—around the bottom in early March 2009—have done very well:

Buying in Times of “Investor Shell Shock” Pays Off

We’ve got a similar opportunity now.… Read more