Articles

Should we income investors buy any bonds right now? Bond prices have rallied, but the rear view mirror doesn’t help any new money we’re putting to work right now. Meanwhile interest rates are tanking, which tends to defeat the point of purchasing fixed income in the first place.

But, stocks are on a roller coaster ride. If you’re getting a bit nauseous with the violent day-to-day swings, you may appreciate a little stability to balance out your portfolio.

Whether you’re looking for dividends, sanity, or both, you’ve come to the right column. Let’s take a spin around Bondland and rank ‘em worst to first.… Read more

Here’s the funny thing about the inverted-yield-curve talk we’re getting hit with lately: most people are looking at the wrong numbers!

I’m going to show you how we savvy dividend investors can jump on this mistake to bag total returns of 69% and up—fast. First, here’s what I mean when I say investors are looking at the wrong numbers.

These days, all we hear about is the yield-curve inversion we’ve seen a couple times over the last few weeks, where the yield on the 10-year Treasury note fell below that of the 2-year.

It’s certainly worth paying attention to, because the inversion of the 10- and 2-year Treasury yields does predict recessions—though the timeline tends to be around 18 months and maybe even longer than that.… Read more

If you’re like most folks, you likely at least take a second look when you run into a big dividend yield, like, say, 14%.

Think about that for a second: drop, say, $100K into a fund like that and just seven years later, you’d have collected enough in dividends to recoup your entire initial stake.

Everything else is gravy!

But when we come across a dividend that big, we need to do a second-level analysis to make sure it’s sustainable. And that brings me to the closed-end fund (CEF) I want to tell you about today—it gives us that 14% yield but misses the mark on just about every factor you could imagine, giving us:

• Impossibly high management fees
• A portfolio that underperforms the market
• An overpriced valuation, and …
• Its profits are falling short of payouts.

Insider buying can be a great indicator for us income investors to buy alongside management. After all, when the big bosses reach into their own pockets to purchase their own payout streams, it’s a signal that they are confident in more than just the next dividend.

They believe their stock has upside, too. Often this results in total returns (including dividends) up to 214%. I’ll show you some examples, and also break down some current “buy” signals, in a moment.

First, let me make sure we are not mixing up insider buying with insider trading. They are two different things.… Read more

With panicked investors in full retreat, we’re left with three ridiculously cheap opportunities that could outpace the market in coming months.

Best of all, the three of them offer respectable dividend yields, with one above 8%.

However, before we jump into them, let’s discuss why markets may be heading higher.

Fears of a Recession are Overblown

Growth forecasts are now rising, and the economy looks nowhere as bad as the bond market yields would have us believe.  For example, even with all of the chaos this summer, consumers have remained resilient– and they’re spending.

July 2019 retail sales jumped 0.7% month over month, for example.… Read more

The most reliable recession indicator in the world just flashed red—and it’s actually setting us up for 33%+ gains in the next two years.

A contradiction? Sure sounds like it.

But history tells us we can expect a fast return like this when the economy and stock market look exactly like they do right now.

I’ve got two ways for you to grab a piece of the action, one of which even hands us a growing 7% cash dividend.

And when I say “growing,” I mean it: this already-huge cash stream has grown 96% in the last 15 years, and it’s backed by the strongest stocks in America (I’m talking about the 30 names on the Dow Jones Industrial Average), so there’s plenty more to come.… Read more

As broke investors worry more and more about a stock market crash, billionaires are quietly loading up on their favorite dividend paying stocks. Investing for growth and income, these “country clubbers” know how to 4X their yields without taking on any additional risk.

Who would you rather invest with? Obviously, the rich guy or gal versus the hopeful retiree sweating out every stock tick.

Wealthy people collect assets that, over time, help them accumulate more and more wealth. Average investors, meanwhile, clutch to their stocks like they are lottery tickets. They buy shares and “hope” that they go up every minute of every day.… Read more

If you ever want to retire (or stay retired!), you’ve got a big problem. Bonds don’t pay much now, and they’re likely to pay less and less in the months and years ahead.

I probably don’t have to tell you that the yield on the 10-year Treasury note has crashed to 1.6%. In other words, a $500K investment would get you a pathetic $4,000 in interest income every six months (as Treasuries only pay semiannually, unlike the three strong monthly dividend payers I’ll show you shortly).

Then there’s the specter of negative interest rates, something folks in many countries already know: today, $15 trillion of government bonds around the world are sloshing around with yields below zero.… Read more

The PGIM High Yield Bond Fund (ISD) trades at a huge discount that’s going to disappear soon.

Before I explain why, let me tell you something else about this fund: it boasts a huge 8.4% dividend yield. In other words, you’d get $700 per month—or $8,400 a year—in income on every $100,000 invested. And you should consider getting in now, because ISD is set to soar.

A New Fund

For years, ISD provided a solid and reliable return, thanks to its strategy. The fund would buy corporate bonds that expired in just a couple years (or less), so there was less risk of any company going bankrupt or defaulting.… Read more

Real estate investment trusts (REITs) are great potential fits for any modern retirement portfolio. With interest rates ticking down from 2% to 1% and, perhaps, eventually 0%, these generous dividend payers are benefitting big time.

REIT stocks tend to yield twice as much as regular ol’ stocks. They collect rent and pay it directly to their investors as dividends. This “capital light” approach gives them cash cow status. It’s a big reason why REITs outperform the broader market over any length of time.

So should we just buy the biggest, most successful REITs and enjoy their dividends and the growth of their payouts.… Read more