Author Archive: Michael Foster

Thinking of joining the “Great Resignation” crowd and dumping your 9-to-5 gig? Let’s talk about how you can do it with outsized 7%+ dividends that easily keep the bills paid.

I’m going to show you the powerful secret some of these “quitters” are using today. It all turns on a unique kind of asset called a closed-end fund (CEF) that’ll be our source for those rock-steady 7%+ dividends (paid monthly, to boot!).

More Investors Discover the Income-Producing Power of CEFs

First off, a funny thing is happening as people dump their day jobs: they’re investing more, with the number of new investors jumping 15% in 2020, and scores of folks who already invest building out their portfolios further.… Read more

I’m guessing you heard about the plunge in Tesla (TSLA) stock spurred by founder Elon Musk’s recent tweet asking if he should sell 10% of his shares.

(The tweet—a poll of Twitter users—garnered a positive response, by the way; Musk says he’ll abide by it.)

I know—another bizarre Musk tweet doesn’t seem to mean much to us income investors. But this one is different, because as hard as it may be to believe, it’s telling us one thing: buy municipal bonds—an asset class many investors dismiss as “sleepy.” That’s not true: there’s a reason why “munis” are favored among billionaires, starting with their huge tax-free dividends.… Read more

There are three funds hiding in plain sight that do something everyone thinks is impossible: pay huge dividends—with yields up to 7.2%—and deliver outsized 24%+ total returns, too.

I know I don’t have to tell you what an inflation-fighting weapon a return like that would be these days.

These are no less than the world’s three best-performing closed-end funds (CEFs) over the long term, and today we’re going to rank them from third to first to see if any (or all!) of them have a place in our investment portfolios.

“World’s Best” CEF #3: 24% Annual Returns for Years and Years

The least impressive CEF on the list, the Columbia Seligman Premium Technology Growth Fund (STK), has “only” a 23.7% annualized return, based on its market price, over the last five years, with a dividend that’s held steady throughout that time (and yields 5.1% today).… Read more

Rising inflation? We closed-end fund (CEF) investors aren’t panicking—we know we can flip rising prices into 7% dividends and 37%+ gains!

Our strategy is simple—pick up CEFs focused on one specific corner of the economy. In fact, if you’re holding a selection of our CEF Insider service’s picks, you’re probably doing this already!

Our Contrarian Income Play Explained

Let’s start with the latest inflation numbers. As measured by the personal consumption expenditures (PCE) index, inflation clocked in at 4.4% on a yearly basis in September, up from 4.2% in August. The story many see behind this is that supply constraints have cut the number of products on store shelves, causing prices to soar.… Read more

You know we’re in a pricey market when even obscure high-yield plays like closed-end funds (CEFs) are pricey!

But we can still find deals in this space, which is hands-down my favorite field in which to hunt for big payouts. In focus today: one totally overlooked fund (from an equally overlooked management firm) throwing off a hefty 7.6% dividend.

This deal can’t last—with yields so low on everything from government bonds to large cap stocks, investors will inevitably seek out this hidden high yielder. And we’ll be in with an early position when they do. (We’ll also delve into two other funds from the same management firm that you need to avoid at all costs.)… Read more

There’s no doubt inflation is eating into our wealth, but luckily we have a solution—closed-end funds (CEFs)!

These unheralded income-and-growth plays are the answer to the wave of inflation we’re all living through, with 6.9%+ payouts that outrun surging consumer prices and crush the typical stock’s paltry 1.3% yield, too.

Members of my CEF Insider service know this well: that 6.9% figure is exactly what our 17-fund portfolio yields today, with the highest payer of the bunch throwing off an outsized 8.1% payout as I write this.

And that’s before we even talk about gains! Investors who’ve been with us since launch in early 2017 have enjoyed a tidy 11.9% annualized return (with dividends reinvested), a gain that consistently leaves inflation in the dust.… Read more

Today we’re going to build a portfolio that can make us totally financially independent with just $500K invested. And we’ll do it on dividends alone—without having to touch our principal.

Now I know that sounds outlandish in today’s low-yield world. Here’s how we’ll make it happen. (Hint: our plan involves three closed-end funds, or CEFs, paying dividends that dwarf the measly 1.3% you’d get from the typical S&P 500 stock.)

The Dividends-Only Retirement Portfolio

The principle behind retiring on $500,000 (or any amount, really) and being guaranteed of not outliving your nest egg is pretty simple: make sure the amount you’re taking out of your portfolio is less than what your portfolio earns you on a yearly basis.… Read more

Stocks are pricey, but we closed-end fund (CEF) investors aren’t sweating it: we’ve got an edge that lets us buy at a discount, with dividends that are double—and sometimes triple—the typical S&P 500 payout!

That would be our ability to buy CEFs that trade at discounts to net asset value (NAV, or the value of their underlying portfolios). This simple move lets us “rewind the clock” and essentially buy the stocks our CEFs hold at levels we could a few months ago on the open market.

(And there are many bargain-priced CEFs to be had out there, including one trading at a 10% discount and paying more than double the average stock’s dividend—more on that below.)… Read more

Let’s work this market pullback to grab ourselves a sweet 21% “double discount” on our favorite stocks. We’ll also get a dividend from blue chip firms that don’t even pay one!

The key is an off-the-radar closed-end fund (CEF) holding some of the biggest names on the market and trading at a totally undeserved 17% below its true value. And this one pays a rock-steady 3.1% dividend, too—double what the typical S&P 500 stock yields!

Before we put a name and ticker to this fund, let’s talk about the first part of the 21% double discount we’re going to tap today.… Read more

Most investors are ignoring a clear shot at 7%+ dividends double-digit price gains—year in and year out—in a sector everyone should be talking about, but isn’t.

That would be healthcare, which is riding a rocket of rising spending: according to the latest numbers from the Centers for Medicare & Medicaid Services, US health expenditures will soar 5.4% annually, on average, every year until 2028. (We’ll dive into three funds paying huge dividends up to 8.3% and poised to cash in on this wave in a moment.)

The thing about that 5.4% yearly increase is that it’s much bigger than projected US GDP growth of 4%.… Read more