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It’s finally happening: Management fees on our favorite 8%+ paying assets—closed-end funds (CEFs)—are falling. And some are sending their already soaring dividends even higher, too.

Those are key reasons to invest in these high-yield plays now. We’ll get into all the details below. But before we do, it’s important that we take a second to put CEF fees in perspective. That’s because many (most?) investors have a totally incorrect idea about them. And it’s caused them to miss out on the income (and growth) CEFs offer.

Ignore the Wall Street Line: CEF Fees Are Sometimes Worth Paying

When I ask investors if they’ve ever considered CEFs, those who say no often mention high fees as a reason.… Read more

“Why is Arbor Realty (ABR) up 10% this morning?”

The emails piled in. And obviously, yes, it was this Tweet from Roaring Kitty—the high priest of meme stocks—that sent highly-shorted stocks higher.

Source: X.com

His real-life identity is Keith Gill. He’s a former financial analyst turned meme stock diocesan. In 2020, Keith aka Roaring Kitty led the charge behind the short squeeze of GameStop (GME), which sent that dinosaur stock (briefly) into orbit.

The mere hint that Gill was back in the game was enough for his disciples to bid up old flames GameStop and AMC Entertainment Holdings (AMC).… Read more

This onshoring trend is roaring—but we contrarian dividend investors still have time to cash in. I’ve got a “3-pack” of cheap stocks that lets us do that, with dividends that are surging (or are about to!) below.

The two latest signs we’re in the midst of “Industrial Revolution II” here in the US? According to new Census Department figures, Detroit, the HQ of industrial America, is seeing its population grow again for the first time since 1957!

The “OG” Industrial Boom

And the latest round in the tariff wars? They’ll almost certainly send more companies scurrying to America.

Think “Picks and Shovels” for the Best Plays on Industrial Revolution II

If you’ve been reading my articles for a while, you know I love “pick-and-shovel” stocks.… Read more

Every now and then here at Contrarian Outlook, we have a “big-dividend shootout”—we pit two big payers against each other and see which one wins out.

It’s a great way for us to accomplish two things as investors: 1) Grab the safest high dividends with the most upside, and 2) Sharpen our portfolio-building skills.

My beat is closed-end funds (CEFs), which are known for huge (and often monthly paid) dividends. These actively managed funds are a bit of a unique challenge to analyze because they each hold a lot of assets—often numbering in the hundreds.

Luckily there are a few indicators we can use to single out the best ones.… Read more

What’s better than a big dividend?

A hated high yield.

Especially when the disgust comes from Wall Street analysts themselves. You know, the fanboys who follow the company for a living.

Analysts are paid to be bullish. Let’s face it, nobody wants to hear from a bear. Here’s how unusual is it for analysts to be down on a stock?

There are just two consensus Sell calls across the entire S&P 500. Two.

So, when one of the suits says a business is bad, we should take note, right?

Wrong.

Analysts tend to be trend followers. And as they say in the business, the trend is your friend until it ends.… Read more

A couple weeks ago, on May 3, BlackRock, the world’s largest investment firm, did something that will send a shockwave through our favorite high-yield investments: closed-end funds (CEFs).

The result is likely to be higher prices for CEF investors in the future—and even steadier dividends, too. Most folks missed this change, but it’s only a matter of time until it makes itself known. We’re already seeing it kick in with some of these high-paying funds.

Before we go further, let’s be clear on what we’re talking about: The $400-billion universe of CEFs currently yields an eye-popping 8.2% on average.

How is that possible?… Read more

Remember when the Federal Reserve stopped printing money for a few months? It didn’t go well.

Yes, I’m making fun. A bit. Chairman Jay Powell did abstain from his printing press for nine full months.

The year, as you’ll recall, was 2022. Headline inflation topped 8%. Eight! Jay, who had been blaming every supply chain from here to Shanghai for the price pressures, ran out of excuses. He held down the power button on his money printer for a hard reset.

Stocks sank 18% that calendar year. Bonds did worse—they completely blew up. A perfectly “safe” fund of US Treasuries, iShares 20+ Year Treasury Bond ETF (TLT) was anything but, shedding 31%.… Read more

It blows me away that folks still think high interest rates will be around forever. Truth is, rates are already starting to fall!

But no one’s really paying attention (yet!). Which leaves us a brief window to lock in some sweet 8%+ dividends from one of our favorite utility-focused funds. This bargain-priced buy soars when rates drop.

Look Beyond the Headlines for the Real Rate Story

Remember January, when all the talk was about how rates would be cut six times this year?

Poof. Those hopes were history before winter—such as it was—ended.

Nowadays, futures traders have almost completely thrown in the towel—they’re calling for just two rate cuts between now and January.… Read more

Every now and then in income investing, we get a sweet setup where a “boring” high yielder absolutely soars—practically overnight.

I recently saw such a scenario play out with a closed-end fund (CEF) called the BlackRock Municipal Income Fund (MUI). I bring it up now because what happened with MUI has a lot to teach us about how we can get stock-like gains from a so-called “boring” income play like this.

Despite its sleepy-sounding name, MUI is what I consider a “triple threat” investment because it can pay us in three different ways:

1. Its dividend, which yields a high 5.5% and has been remarkably stable, even throughout the low-rate 2010s.

Small-cap stocks are on sale. We can buy select names for just 8.8 times earnings and 83% of book value.

Large cap stocks rarely sell this cheap. That is the problem with popularity! Which is why we’re looking small but thinking big, eyeing payouts between 7.3% and 13.8%.

(Those dividends are no typos. The beauty of being nimble individual investors means we can fish in these small but potentially lucrative ponds.)

Now small cap stocks aren’t always this cheap. Traditionally, smaller firms trade at a premium to their large-cap counterparts given their outsized upside potential. But today, small caps are less expensive by just about every valuation measure.… Read more