Author Archive: Michael Foster

Chinese stocks have cratered, and that might have you wondering if there are bargains to be had.

If you invest in closed-end funds (CEFs), which regularly offer yields north of 7%, you may also be wondering if CEFs that focus on China might be worth a look now, too—especially as these funds’ yields have popped as their prices have faded.

Let’s dive into the current state of play in China and answer these questions. Further on, I’ll give you my verdict on a China-based CEF throwing off an outsized 6.6% yield today.

Chinese Stocks Plunge: Value or Trap?

If you’re wondering where the pull some value investors are feeling toward China is coming from, this chart explains it.… Read more

Here’s my best advice as 2022 dawns: ignore the media’s constant bleating about inflation and supply-chain issues—these two boogeymen are nowhere near the threats everyone thinks they are!

In fact, terror-ridden headlines about either mark an opportunity for us contrarian income-seekers. So let’s go ahead and tap these investor fears for dividends yielding up to 10%, plus market-crushing returns as the crowd (inevitably!) comes around to our view.

Hints of a Supply-Chain Revival

More data will come in over the next few weeks to make things clearer, but so far there is one strong hint that the business press’s doomsday scenario—surging inflation, a stock-market correction and tighter corporate profits—just isn’t on.… Read more

If you invest in closed-end funds (CEFs), you’re already miles ahead of most folks. (And if you don’t, there’s never been a better time to try them—I’ll show you a tech-focused CEF whose payout triples the dividend on “regular” stocks in a moment.)

A Trillion-Dollar Monster

The main reason why most investors miss out on CEFs (which offer tantalizing yields of 7.3%, on average, as I write this), is that the CEF market is small, with only around 500 CEFs out there in total. Compare that to ETFs, which numbered around 7,600 last year.

In fact, last year, ETFs hit a big milestone: they attracted a trillion dollars in a single calendar year.… Read more

Today we’re going to take a look at an unusual closed-end fund (CEF) that hands us a rich 10.5% dividend that comes our way monthly (and grows!). And it sends regular special dividends our way, too.

When you add those “bonus” payouts in, this fund often pays life-changing yields of up to 15%!

The fund in question is the PIMCO Dynamic Income Fund (PDI), a dividend titan that should be on any closed-end fund (CEF) investor’s watch list. (In fact, if you’re a subscriber to Contrarian Income Report, a sister to my CEF Insider service, you already know PDI—it recently landed in the CIR portfolio through a merger we’ll discuss a little later.)… Read more

Imagine a fund that’s beaten the Oracle of Omaha himself, Warren Buffett, for years and, unlike Berkshire Hathaway (BRK.A), pays a whopping 9% dividend!

Little-Known CEF Outruns the Best

As you can see in the chart above, the fund in question here is a closed-end fund (CEF) called Central Securities Corporation (CET). It’s got two things in common with Buffett himself: a focus on value and a long history—even longer than Buffett’s! CET traces its roots all the way back to 1929. In fact, the fund was founded on October 1 of that year, just 28 days before the Black Friday crash that triggered the Great Depression!… Read more

Once folks get a taste of closed-end funds (CEFs), they typically rave about one thing: the dividends! Yields of 7% and up are common with CEFs, and they often come your way monthly.

We also love the fact that even though CEFs are a small corner of the market (with only about 500 or so out there), we can build a diversified portfolio with them: there are CEFs that hold US and international stocks, bonds, real estate—even private equity. You name it.

This broad range gets us around a problem most income-seekers face: being forced to stake significant sums in one, or a handful of, stocks just to get big payouts.… Read more

Think about it for a moment: when was the last time you read anything about closed-end funds (CEFs), a way too often overlooked asset class that throws off 7%+ average dividends?

Never? Maybe once?

It’s a shame that CEFs are rarely discussed outside Wall Street circles, because they’re perfect for anyone who needs income these days. (And who doesn’t!?)

Smaller CEFs Give You Big Payouts And “Baked in” Upside

We’re going to bust through that barrier and look at how we can use CEFs to boost our income streams and our net worth, too.

We can dial ourselves in for even bigger gains when we focus on smaller CEFs, like the ones I emphasize in my CEF Insider service.… Read more

Let’s be honest: we dividend investors will be glad to see the back of 2021. While it’s been a great year for us at my CEF Insider service (our portfolio yields 7.2%, on average, and we’ve seen some nice double-digit winners, too), it seems like every day begins with a market-crushing (and anxiety-inducing!) news story.

To be honest, 2022 will likely bring much of the same, but if you do what I strongly recommend—stay away from the business news as much as possible—you’ll do your portfolio (and your mental health!) a big favor.

You and I both know the pundits rarely get it right anyway (who remembers the hand-wringing worries about deflation 12 months ago?… Read more

I shudder when folks tell me their portfolios can’t give them a decent income stream. Because I know there’s an easy way for them to get safe 8%+ payouts—and everyone misses it.

Let’s be honest. When it comes to investing, most people limit themselves to the blue chip stocks of the S&P 500. The problem? These stocks pay a miserly 1.2% average yield. So you’re getting a measly $1,200 in yearly dividend income for every $100K invested!

No one is retiring on that—unless they have a couple million bucks lying around.

But there is another way. It’s a potent income generator I’ve been specializing in for more than a decade—and sharing with investors through my CEF Insider service.… Read more

Investors sometimes tell me that closed-end funds (CEFs) are complicated—riddled with jargon-y terms like discounts to NAV and net investment income (NII).

The truth is, while it may take a little bit of time to learn the ropes, the effort pays off in spades, since CEFs can get you about $3,000 per month in dividend income on a $500K investment! That could mean retiring a decade or more before folks who rely on low-yielding S&P 500 stocks or ETFs.

(And of course, if you’re a member of my CEF Insider service, I do the legwork for you, letting you collect our portfolio’s 7.3% average yield, with upside, without having to spend hours in front of a computer screen.)… Read more