Author Archive: Michael Foster

There are few things that have a stronger hold on investors’ imagination than gold. When inflation and market volatility spike, many folks simply can’t resist the yellow metal’s call.

But the truth is, for us dividend investors, gold is a raw deal. That’s mainly because, of course, it pays no dividend! Heck, if you buy physical gold, it actually comes with a cost for storage and safekeeping.

Worse, gold doesn’t even work as a hedge against inflation and volatility—at least it sure hasn’t this time:

Inflation Storm Hits, Gold Tanks

This shows the dangers of buying based on outdated investor “sacred cows” like the one that says gold is a safe haven.… Read more

When markets are down, there’s one group of investors who can shrug off the dip because they don’t need to sell. You’re no doubt part of this group—I’m talking about income investors.

With dividends, of course, you can keep your cash flow going regardless of short-term panics over things like interest-rate hikes and geopolitical unrest. Because the cash keeps coming in, you don’t need to sell during these times and can instead use your dividends to keep your bills paid—or maybe even buy the dip in the markets, thereby building your income stream further.

But where can you get reliable income that won’t be hit by the Fed’s moves and other events that are mostly beyond our control?… Read more

If you’re looking for 9%+ dividends and an income stream you can retire on without selling shares from your portfolio, closed-end funds (CEFs) are handing you a superb opportunity now.

That’s because this selloff has set us up with bargains in the space, including many CEFs (like two we’ll profile below) throwing off 9% and even 13.7% dividend payouts.

My CEF Insider members know I’m enthusiastic about picking up CEFs at these levels, so long as you’re investing for the long haul and can deal with more volatility, as there’s likely to be more before stock markets ultimately find their footing.… Read more

Today I want to show you how to build a “three-click” income portfolio that gives us three things every income investor craves, especially these days:

1. Big discounts on our investments.
2. Big dividends, with a 10.6% yield averaged out across three funds.
3. Wide diversification, with investments from across the economy.

Put the three closed-end funds (CEFs) I’ll show you below together into their own “mini-portfolio” and you could pull $10,600 in dividends from a $100K investment; $53,000 from $500K and a six-figure income stream—$106,000—from a million.

Let me introduce these three high-yielding CEFs to you now.

CEF #1: Tapping the Energy Boom for a 7.1% Payout

The ClearBridge Energy MLP Total Return Fund (CTR) yields 7.1% as I write and comes to us at a 20.3% discount to net asset value (NAV, or the per-share value of its portfolio).… Read more

We all know the markets are undergoing a shift—and it’s time for us to stop and take a look at what it all means for our dividend portfolios, particularly our closed-end fund (CEF) holdings.

So today we’re going to step back and look at the economic state of play. (Hint: it’s not as bad as the headline writers lead us to believe: CEF investors—and particularly members of my CEF Insider service—are nicely positioned for the months to come.) I’ll also name a 7.4% dividend that’s currently trading at a bargain price.

History Is on Our Side

Let’s start with corporate profits, which came in better than expected in the first quarter of 2022, with over three-quarters of companies across all sectors reporting earnings above expectations, more than the average, with earnings up 9.1% from a year ago.… Read more

In a plunging market like this one, it’s critical to play the long game. For us closed-end fund (CEF) investors, that means staying invested, because we simply do not want to be out of the market when the (inevitable!) bounce comes.

More important, we need to keep our income streams rolling in. They’ve never been more critical than they are now. And CEFs are throwing off some very healthy payouts these days, with the average CEF yielding north of 7% as I write this.

But there are a few things we can do to further reinforce our dividends and tone down our portfolio’s volatility.… Read more

Here at Contrarian Outlook, we’ve been talking a lot about crypto lately—but not in the way you might think.

We’re not buyers—far from it! Instead, we’re using a savvy, dividend-focused strategy to set ourselves up for some nice gains (and dividend payouts!) as gamblers flee crypto and speculative tech stocks. (I’ll spotlight two closed-end funds that are aligned to scoop up our “crypto refugees” while handing us dividends yielding up to 11% in just a moment.)

I’m reminded of crypto right now because many of these “coins” have fallen hard recently—and last week, we got word of one that went essentially to zero!… Read more

With all the panic over the headlines these days, it’s a good time for us contrarians to step back and take stock—because there are high-yield bargains out there that can help us navigate this mess.

(Hint: the best hunting ground for us contrarians today is in a group of roughly 500 funds called closed-end funds, or CEFs, many of which pay 8%+ yields and trade at ridiculous discounts. More on them, and a 9.9%-paying fund that might be a good fit for you if you’re investing for the long term, in a moment.)

First, if you’re feeling nervous about your portfolio, let’s step back a bit.… Read more

This wild economy has set us up with an opportunity to smartly “time” both the real estate and stock markets—and grab ourselves a hefty 9.9% dividend along the way.

I’ll show you a ticker we can use to do it in a moment. But first, let’s talk about the stock/real estate “two step” I’m proposing—starting with the state of play in the housing market, which has changed a lot in the last few weeks.

House Prices Look to Be Peaking

It comes as a surprise to no one that house prices are on a tear these days, hitting an average of $500,000, according to the latest numbers:

When most Americans buy their primary residence, they aren’t primarily focused on the sticker price; their monthly mortgage cost is what they’re really looking at.… Read more

Most investors I speak to have no idea how much they’ll need to retire (and with the uncertainty we’re facing today, that’s totally understandable!).

So let’s talk about that—and focus on closed-end funds (CEF), totally overlooked investments that could let you retire on dividends alone, possibly on as little as $325K. That’s the ultimate way to get peace of mind these days, because you don’t have to worry about selling into a pullback to keep your income stream intact.

The Income Side

When calculating how much you’ll need to clock out of the workforce, you really only need to know three things:

1. How much you’ll spend in your first year of retirement.