Author Archive: Michael Foster

Think we’re stuck with pathetic dividends and sluggish growth in 2020?

I get it. Many folks I talk to see the coming year this way. Some are even selling stocks, in a doomed effort to “lock in” gains. The problem? What the heck do you do next?

Sitting in cash means watching helplessly as inflation erodes your nest egg. And dividends? Forget it! You’ll kiss those goodbye the moment you hit the “sell” button.

Here’s the good news: you’re not stuck between the pathetic sub-2% payout on regular stocks and the 0% you’ll get in cash. There’s a better way—one that pays you huge 6%+ dividends and regularly crushes stocks!… Read more

If you’ve been holding the Cohen & Steers Quality Income Realty Fund (RQI)—a fund I wrote about a lot in 2019—you’ve done very well indeed. RQI has dominated, with its market-price return surging 51.9%, including gains and dividends, since the start of 2019.

So today we’re going to take a closer look at this superstar fund to see what lies ahead, and whether it’s still worthy of your cash, even with its big 2019 gains.

If you’re not familiar with RQI, it owns real estate investment trusts (REITs), such as cell-tower owners Crown Castle International (CCI) and American Tower (AMT), warehouse landlord Prologis (PLD) and data-center REIT Equinix (EQIX).… Read more

If you’ve been told it’s impossible to outperform low-cost index funds because the market’s too efficient, you’ve been misled.

The truth is, there are many funds that have been beating the stock market for years. And here’s something really surprising: there are more funds pulling off this feat now than there have been in a long time!

In fact, across ETFs, mutual funds and closed-end funds (CEFs), there are 3,594 funds that have beaten the S&P 500’s 24.3% return since the start of 2019.

So much for not beating the market!

That leads me straight into the two things I want to discuss with you today:

1. Why now is still a great time to buy, even with stocks near all-time highs, and …
2. Why you’ll give yourself better odds of beating the market, and grab far higher dividends, if you go with actively managed funds, particularly CEFs like the technology-focused fund yielding an outsized 6% now that I’ll tell you about shortly.

With the whipsawing market we saw in early December—and now a snap back to near all-time highs—now is the perfect time to talk about one of the biggest questions you’ll face as a closed-end fund (CEF) investor: how do you know when to sell a fund?

Unfortunately, there’s no simple answer—and often investors who use conventional sell signals, like a falling market price, will end up selling at the worst time.

That leads me to my cardinal rule with CEFs: it’s easier to know when to buy than when to sell. If the fund is well managed, has a strong track record, is deeply discounted and has a relatively safe dividend, it’s generally a screaming buy.… Read more

What if I told you there was a corner of the market where every single fund has turned a profit? And these amazing investments paid out a huge income stream that was entirely tax-free?

The kicker: many of these funds—including one throwing off a 4.6% dividend now (that could be worth 7% or more to you, depending on your tax bracket)—are trading at discounts to their “true” value now. I’ll name this low-risk income (and growth) play shortly.

146 Funds, 0 Losers

This story starts with municipal bonds, which are issued by cities, counties and states to fund buildings, roads and hospitals.… Read more

Today we’re going to look ahead to 2020—and specific sectors to target for rising profits (and dividends!) in both stocks and 7%+ yielding closed-end funds (CEFs).

We’re also going to look inside a worrisome piece of news you might have heard about 2019—that analysts expect corporate profits to rise a meager 0.3% when they close the books on this year—and uncover why this is not a scary omen for the future.

Because when we hear numbers like that, we need to look further and see where they’re coming from. In this case, there’s a very simple reason no one is talking about.… Read more

How the heck do you fund your retirement today, with regular stocks yielding a pathetic 1.8%?

Today I’m going to show you exactly how—and we’re going to use my favorite tool, closed-end funds (CEFs) to do it. In fact, we’re going to zero in on a particular CEF that’s the poster child for how these high-yielding funds can deliver the retirement you want on a modest nest egg—far less than that million bucks many advisors say you need.

To start, this solid fund pays a steady 6.4% dividend now—nearly four times the payout you’d get from a “regular” stock. Even better for retirees, it pays you that dividend monthly, in line with your bills.… Read more

Worried about a 2018 (or worse, a 2009) repeat?

Good news: I’ve got a closed-end fund (CEF) that should be on your list no matter what happens: it carries a special “insurance” policy if markets head south; it’s nicely positioned to gain when markets rise; and—the cherry on top—it pays a massive 10.3% dividend.

But before we get to this all-weather fund, I have something I need to tell you about those pullback worries: they’re way overblown. Because despite fear-mongering headlines, my latest research shows there’s every reason to expect stocks to hit all-time highs again—and soon. Here are three reasons why.… Read more

“Buy low, sell high.” It’s the oldest investor slogan there is—and the deadliest one, too!

You simply cannot afford to give in to this “wisdom” today, even though it’s tempting. Now that we’ve seen a couple of days of weakness, you might be wondering if the recent all-time high was a sign to sell—and if all-time highs are often signs to sell. But do that now and you’ll certainly leave huge income—and upside—on the table.

Instead, now is the time to buy, especially closed-end funds (CEFs) paying dividends of 7% and up. I’ll give you an example of one of these high yielders—which drops its payout into your account monthly—further on.… Read more

Let’s dive straight into a trap I’ve seen many investors make in the past. And falling into this pitfall again today could cost you a 7.7% dividend in 2020, and considerable upside, too.

It involves China’s stock market, which gives all indications of being a bargain today. Too bad it’s anything but!

China Equities Get a Beatdown

Truth is, there do seem to be some screaming bargains in China-focused closed-end funds (CEFs) these days—like the Templeton Dragon Fund (TDF), which trades at a 12.1% discount to NAV. Or the Morgan Stanley China Fund (CAF), which sports the same 12.1% deal.

But many Americans have been lured into the China story in the past decade, when it looked like the Red Dragon would finally lurch ahead of the US … only to have it end in tears.… Read more