Author Archive: Michael Foster

Do you remember the biggest threat to the stock market in the summer of 2017?

Let me refresh your memory: a nuclear war with North Korea.

It was barely a year ago, but financial pundits and so-called experts were screaming from the rooftops about volatility spiking with the risk of a nuclear war. Here’s what actually happened as Armageddon fears fizzled:

Market Tunes Out Pundits’ Panic

So much for heightened fears! In fact, despite unusually large spikes in volatility earlier this year, as a whole, this measure of market fears has been on a steady decline.

Oh, and those spikes in volatility you see earlier this year were because of a new risk du jour.… 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 lied to.

The truth is, there many funds out there that have been beating the broader 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 7,643 funds that have beaten the S&P 500’s 7.62% return over the past year.

So much for not beating the market!

Besides the fact that not choosing the low-fee passive fund will get you superior returns, you might be also be surprised by one other fact I just threw out there: a 7.62% return for stocks in general over the past year.… Read more

I’m sure you noticed that when America decided on a Republican-majority Senate and Democrat-majority House, the markets jumped.

The best news: it’s just the beginning of what’s likely to be a long-term uptrend in stocks. So if you sold during the recent market panic, you’re going to miss out on that upswing—that is, unless you buy now.

But what to buy? While the SPDR S&P 500 ETF (SPY) is already up 3.6% since the end of October, it still has gains ahead because of slower investors who haven’t come back into the market  after last month’s panic selling. If you buy now, you might beat a lot of them to the punch.… Read more

Here’s something few people realize about closed-end funds (CEFs): sometimes, when it comes to these funds, matching the market means you’re actually beating the market.

Let me show you what I mean using the AGIC Equity and Convertible Income Fund (NIE), a CEF I recommended earlier this year. NIE has been meeting the S&P 500’s performance, though most people don’t know it.

And by meeting the S&P but giving investors a 7.5% dividend yield, it’s helped income investors actually beat the market if they’d chosen a “dumb” index fund like the SPDR S&P 500 ETF (SPY) instead.

First, let’s address the hidden returns.… Read more

If you’re still fearful about stocks as we pick up the pieces from the market’s grim October, let me ease your mind with one chart:

Stocks Still a Long-Term Winner

As you can see, that’s the market’s return over the last 10 years. As you can also see, stocks have returned nearly 2.5 times a person’s original investment in just a decade! Few other investments can make that claim.

The real problem? Income.

The average S&P 500 stock pays a lousy 1.9%, but let’s say you need 8% of your portfolio in monthly income to pay your bills in retirement. If you buy the popular SPDR S&P 500 ETF (SPY) and withdraw 8% monthly, you’ll be forced to sell in a falling market like the one we’ve seen.… Read more

From what I hear from readers these days, a lot of people out there are compulsively clicking the “refresh” button, living in fear of the next 500+-point drop in the Dow.

But is now the time to actually start panicking?

We’re going to dive into that question today. I’ll also reveal 1 fund that protects your nest egg with a unique form of “insurance” while handing you a huge 7.5% cash payout.

More on this lifesaving “pullback-proof” dividend a little further on. First, we need to talk about …

Why the Pundits Are Wrong (Again)

The market wipeout has had one extra element that’s added even more terror: dire warnings from the semiconductor industry, which sent Advanced Micro Devices (AMD), Texas Instruments (TXN) and Nvidia (NVDA) into free-fall and badly beat up the benchmark VanEck Vectors Semiconductor ETF (SMH).… Read more

If you’re like most people, you probably think it’s tough to find a fund that’s had a great 2018, especially since recent volatility has brought pessimism back in vogue.

But you’d be wrong.

Truth is, a lot of funds are doing well, with over 400 up nearly 5% or more so far on the year. The top performers share 3 common themes that could tell us a lot about which sectors are poised to take off next year.

Let’s dig in. Along the way, we’ll hone in on 13 funds cashing in as these breakthrough trends head higher.

Trend No. 1: A Return to Healthcare (5 Funds)

Investors tend to get scared of healthcare and biosciences stocks during times of broader market unease, but every once in a while they ignore the panic and focus on the lifesaving innovations this sector can provide.… Read more

In a recent survey of CEF Insider readers, a few asked me whether I prefer equity or debt closed-end funds (CEFs) and why.

It’s an intriguing question because the two fund types act very differently. So let’s dive into these differences, and the benefits both breeds offer, so you’ll know which fits best in your portfolio now.

Equity Vs. Debt Funds

Put simply, an equity CEF has more than half its assets in stocks, while a debt CEF has more than half its assets in debts—usually corporate bonds, junk bonds or municipal bonds. Sometimes the lines get blurred, like with convertible-bond funds that also buy stocks.… Read more

With the recent panic, many people fear there’s just no good way to make good money in stocks anymore.

This is really short sighted!

And dead wrong.

But to make the most profits in a market like this, you simply must choke back your natural instinct to flee when stocks are a sea of red.

To see how being greedy when others are frightened pays off, let me show you a classic example: a fund that holds the very investments that set off the financial meltdown back in 2008. And you’ll probably be shocked to hear that I see them as a screaming buy today.… Read more

With the stock market collapsing 6% from its all-time high in just two weeks, a lot of people are freaking out.

Don’t follow them!

Because now is the best time to buy we’ve seen in a long time.

Before I show you my top 3 “buy now” indicators—which are all blaring green—and a bargain 7.5%-yielder to jump on now, let me first say that we’ve been here before.

In mid-February, with the market again on its back, I urged readers not to panic. This has happened since:

A Quick Recovery

While a 1.6% total return in 8 months isn’t much to write home about, it’s not the massive loss a lot of investors are terrified of today.… Read more