Author Archive: Michael Foster

Legendary investor George Soros is controversial, but his tremendous investment performance over a lifetime is indisputable. Soros attributes it to a concept called “reflexivity.”

Simply put, this refers to the tendency for market expectations to create market outcomes. For instance, when the market expects a fund to crash, it will sell off that fund, thereby causing it to crash.

Here’s the opportunity: when a fund crashes just because everyone thinks it will, the fund tends to bounce back when everyone realizes the market made a mistake.

This happens constantly in the closed-end fund (CEF) universe—a relatively small world of $300 billion in assets managed in about 500 funds.… Read more

On January 1, 2018, I made my boldest prediction of the year: bitcoin was going to crash. Here’s what happened since:

Crytocurrencies Are Dying

There are lots of reasons why bitcoin has cost investors a lot of money: it’s inefficient; it’s not private; and glitches and hacking cause people to lose bitcoins. But the main reason is this: the dumb money followed the smart money—and ended up holding the bag.

I’ve seen this story play out many times, which is why I urge you to be contrarian and avoid the traps market manipulators set up, whether it was dot-com stocks in the late ’90s, housing in the mid-2000s or fantasy Internet money in the 2010s.… Read more

Today I’m going to show you why this market isn’t as spooked as you might think. Then I’m going to reveal the 1 sector (and 1 fund boasting an incredible 8.7% dividend yield) that’s a screaming bargain now.

Let’s start with the state of play as I write this.

Here’s a question: of the 11 sectors that make up the S&P 500, how many do you think are negative for 2018?

If you said more than 5, the pessimism of the financial press has tainted your worldview. Take a look at this table:

5 in the Red, 5 in the Green

A close look at the 11 sectors of the S&P 500 is crucial, because we quickly see that 5 sectors are green, 5 are down and 1 is flat for 2018.… Read more

Remember two months ago? The S&P 500 was hitting record highs daily—and stocks were looking at a hefty 9% gain on the year.

It feels like a dream! Because here’s where we are today:

Poof!

Now we find ourselves down 10% from those highs and staring down the real possibility of a negative year for stocks.

We’ve Been Here Before

If this has left you feeling a little shaken, you’re far from alone.

My take? Tough as it is, resist the gut-driven urge to sell, because this is a buying opportunity. (I’ve got 2 dirt-cheap funds throwing off 7%+ dividends that are perfect buys for the coming rebound.… Read more

There’s a rare opportunity bubbling up in an obscure corner of the market, and we need to act now, because with a quick hand, we can snag 5.9% tax-free dividends in 2019 and double-digit upside—in just 3 quick buys.

I’ll reveal the names of these 3 surprising investments in a moment.

But for now, I’ll tell you that this time-limited shot at income and gains comes from the municipal-bond market—and specifically a shift in the interest-rate picture that “muni” investors have completely missed. But that won’t last.

Let me explain.

As everyone knows, 2018 has been a year of constant rate hikes.… Read more

Monday’s major jump in stocks is the beginning of a trend that will catch a lot of investors by surprise: fundamental strength thanks to trade war fears abating.

We aren’t out of the woods yet, as Tuesday showed us. While the market cheered the tentative cease-fire between Xi and Trump on Monday, the lack of details and confusion hit the market on Tuesday.

And that’s a good thing, because it’s set up investors for an opportunity to buy equities cheap before the relief rally around the corner.

Trade Ceasefire Opens Buy Window …

The way I see it, the trade-war ceasefire is likely the beginning of a deal coming down the pipe in the next three months.… Read more

Ignore the doomsayers: 2019 is setting up to be a strong year for equities—and a great year for dividend investors like us.

I know this might surprise you, so let’s break it down. Further on I’ll give you 5 funds (with dividends up to 11.5%!) that are flashing buy signals you can’t afford to ignore.

So why am I so bullish on the year ahead?

Thanks to the record-breaking profit growth we’ve seen in 2018, along with continued steady gains in employment and wages, there’s little reason to believe next year will bring the big downturn everyone’s worrying about. Instead, the Fed’s prudent scaling back of interest-rate hikes should fuel more growth.… Read more

Are you looking for the 1 perfect buy for big upside and huge (I’m talking 9.5% here) dividends?

Near the end of this article, I’ll show you 1 fund that will let you nail down both. This opportunity comes from a shift in the market that’s been so quiet, almost no one has picked up on it—except for one group.

Enter the “Smart Money”

You’ve probably heard the phrase “smart money”.

It’s really just shorthand for active managers, like those at the big hedge funds, investment banks and other massive institutions, who make billion-dollar bets based on massive troves of information and experience.… Read more

Since launching my CEF Insider service in early 2018, the picks I’ve given subscribers have outperformed the broader CEF market. That’s prompted a lot of people to ask me how I choose the CEFs I do—especially in a market as wild as the one we’ve seen in the last couple months.

My process is both complicated and straightforward. I have a checklist of 52 points I go through to choose the right fund. I apply these one by one, first using some of the broader points to screen funds, then zooming in closer, using more complex analysis to bring you my very best buys.… Read more

If these whipsawing oil markets are making you dizzy, you’re far from alone.

But this isn’t the time for worry—it’s time to tap oil’s woes for 7%+ dividends and upside!

And, as you’ve probably guessed, I’ve got the perfect funds all lined up for you—3 of them, to be precise. One of these contrarian buys yields 10.4%! And each of these 3 expertly run bargains also gives you some much-needed downside protection, too.

But before we get to them, let’s talk about what’s actually going on with crude these days.

You probably noticed that oil was on a roll from the middle of 2017 until a few weeks ago, when it plunged back to earth.… Read more