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Most mainstream financial websites are not “smart enough” to include special dividends. The yields they display reflect plain ol’ quarterly or monthly payouts.

For most stocks this does not matter. But for a select few “special payers” this is a costly oversight. One that we can capitalize on as thoughtful contrarians.

In a moment we’ll discuss five special dividends. The vanilla screens say they pay as little as 3.2% but in reality they dish up to 13.8%!

What exactly is a special dividend payment?

It is a one-time cash payout, often the result of a massive cash influx from, say, selling off part of the company or having an unusually profitable year.… Read more

If you’re like me, when you see an outsized dividend yield, you stop and immediately do the mental math. How much would we get back in payouts from, say, a 9.3% payer if we were to invest $10,000? Or $20,000? Or $100,000?

But savvy contrarians we are, we know to push back on this initial reaction and look deeper.

That’s because of something I know pretty much goes unsaid among contrarian income investors like us: Those big yields can be (and usually are) a danger sign. Truth is, a rising dividend is only one possible reason for a high payout.

And in fact, it’s the least likely one.… Read more

If there’s anything better than monthly dividends, well, we contrarians don’t want to know about it. Getting paid on the same schedule as our bills (monthly!), makes retirement planning easy.

We still need enough yield, though, to get rid (and stay rid) of our day jobs. Our pile of savings is what it is at this point, so we look to larger dividends to do the heavy lifting for us.

The S&P 500, needless to say, won’t cut it. First, the “SPY” pays quarterly—not often enough! Second, it pays 1.2%—not high enough!

“The Market” Is Paying Just Pennies

Even yield-focused funds’ yields are pretty lame right now.… Read more