Articles

The recent oil correction has opened a window for us income investors to grab big(ger) dividends at big(ger) discounts! Today we’re going to take full advantage.

In a moment, we’ll discuss a 3-click energy dividend portfolio that yields 5.9%. Plus, we have some price upside in addition to these payouts, thanks to the pullback in the energy sector.

There’s no doubt the goo has taken a header, dropping from $75 a barrel in mid-July to $62 as I write this. But that’s overdone: consider that our “crash ’n’ rally” scenario (which I’ve been arguing with anyone who will listen for 16 months now) is still in early days.… Read more

It’s hard to believe, but there actually is a 10% dividend sitting right under investors’ noses—even now, when the typical S&P 500 stock dribbles out a pathetic 1.3% payout.

That 10% payer is a closed-end fund (CEF) called the Liberty All-Star Equity Fund (USA). We’re going to put this fund in the spotlight today, so we can see how it offers such a large dividend in these income-lean times, and whether it may be for you.

Let’s start with performance: USA has delivered a total return far larger than that of the market in the last five- and 10-year spans (as well as in the last three years, one year and for 2021 so far).… Read more

Your next Amazon.com box could be fueling a dividend—and stock price.

Talk about delivery-powered dividend growth! In the US, 3 billion e-commerce packages were delivered in 2020. And its not just Amazon (AMZN).

Brick-and-mortar retailers have finally realized that they must answer Amazon with convenient deliveries. Smart retailers such as Walmart (WMT) and Williams-Sonoma (WSM) have figured out that “omni-channel” (in-store and online) is the future.

They’re the types of companies that will survive the “great reset.”

E-commerce swallowed brick-and-mortar market share over the past decade, making up just 6.4% of retail sales in 2010, but a whopping 15.8% in 2019.… Read more

Apartment rents are on a tear of historic proportions.

National median rents have increased by nearly quadruple the typical increase in any normal year.

And it doesn’t seem to be slowing down.

Have you tried to buy a house lately?

House prices increased by the fastest rate on record in July; simply put, renters can’t afford to buy a house right now.

And not only are renters getting priced out of the market, but they are also relocating.

Despite some return to normalcy in urban locations, many young renters have fled the big city, spurred by the ability to ‘work from anywhere’, better work opportunities, and a desire for more affordable housing.… Read more

As dividend investors, we don’t usually read the tea leaves in employment reports (that, after all, is the domain of economists!). But there is something happening in the working world that’s set to power the payouts, and prices, of a select group of closed-end funds (CEFs) for years to come.

That is this: people are spending less time in the office. But productivity isn’t falling. And of course, demand for workers is surging right now, setting the stage for pay hikes, bonuses, stock options—just about any way to put more money in workers’ pockets that you can think of.

Employment Roars.… Read more

A “great reset” is underway in our economy. The talking heads bemoan the losers. We contrarians should pay attention to the winners—and their stocks—because that’s where fortunes will be made.

I’ve seen this trend unfolding firsthand. My second software company, which focused on marketing for e-commerce stores, launched a Shopify (SHOP) app in 2013. At the time this was a fledgling platform that helped retailers sell their wares online.

We were a startup ourselves, newly minted a year prior. To the outside world we described ourselves as a “spinoff” from my first software company, to give the feeling of stability. In practice, we were three dreamers working for free to get our company off the ground.… Read more

Ignore anyone who says share splits have no impact on your portfolio (or your dividends!).

They absolutely do set you up for a nice price bump. I’ve seen it time and time again. It’s easy to see why: when a company—especially a top-notch dividend grower—splits its shares, the move draws in folks who’ve been holding off, seeing the pre-split price as too expensive.

Let’s be honest: we’ve all done this. How many times have you avoided a stock because it trades for $300 a share? Or $500 (or whatever your idea of expensive is)? Never mind the really high traders, like Alphabet (GOOGL), at $2,700, or Berkshire Hathaway (BRK.A),… Read more

These days, many of the dividend investors I talk to feel squeezed between:

1. Weak yields (which have plunged as stocks have surged) and
2. High taxes (which are likely to rise further).

You’re no doubt feeling this pinch, too. The good news is that there’s an investment that lets you wiggle out of this trap, regularly offering steady-as-she-goes dividends up to 5%.

There’s another nice twist that works in your favor here, because these payouts are tax-free, so they could be worth a lot more to you—I’m talking payouts north of 7.5% with tax savings factored in, depending on your tax bracket.… Read more

Did you know that over 36% of US publicly traded REITS either cut or slashed their dividends during the pandemic?

This combination of dividend cuts and demand from yield-hungry investors has led to bottom-of-the-barrel yields across the industry.

The Vanguard Real Estate ETF (VNQ), which is a solid proxy for the REIT market, now pays only a 2.2% dividend yield, well below historic averages.

It shows the importance of finding high-quality, well-managed REITs that can sustain their dividend payments, even in the throes of a financial disaster.

I’m here to tell you that despite the dividend cuts, there are still plenty of attractive high-yielding REITs out there. … Read more

Double-digit dividends are rare. A sky-high yield of 27.2% is an outright income unicorn.

Only in the merry world of closed-end funds (CEFs) would we see such a tale. It’s enabled by talented money managers who, thanks to wide investment mandates, serve as the Willy Wonkas of the CEF factory.

These managers have an endless bag of tricks at their disposal. They can put options to work. They can “double down” on their own bets. They can double, triple and even quadruple the yield on traditional investing strategies, leading to average yields in the high single digits and stretching all the way to 27.2%.… Read more