How We Bagged 7.3% Dividends, 42% Upside (1 Easy Step)

Brett Owens, Chief Investment Strategist
Updated: July 28, 2020

These days, everybody’s looking for the one magic indicator that says when an investment is overbought—or better yet, reveals if it’s a terrific bargain.

Of course, no signal is right 100% of the time, but there is one that gives us the next best thing and unlocks high, “crisis-resistant” dividends, too.

The Perfect Crisis-Investment Indicator (for 7%+ Dividends)

The “bargain alert” I’m talking about is a figure called the discount to net asset value (NAV). And you’ll only find it in a high-yielding investment called a closed-end fund (CEF).

Before we venture too far into financial-jargon land, let’s unpack this, because what I’m about to show you is the simplest, most effective way I know of to grab steady 7%+ dividends and predictable upside in any market.Read more

This “Dividend Inflator” Turns a 5.6% Payout Into 7.1%+

Michael Foster, Investment Strategist
Updated: July 27, 2020

Preferred stocks are hands-down the most ignored investments in this crisis. That’s too bad, because they’re one of the best ways to get a high, safe income stream. And you can supercharge their dividends by purchasing these “dividend unicorns” through preferred-stock closed-end funds.

Before I go further, let me say that if the term “preferred shares” has your eyes glazing over, I get it: most people feel these investments are too obscure to bother with. But stick with me, because preferreds are actually perfectly suited to today’s contradictory economy, with its high numbers of bankruptcies and a rising stock market.… Read more

These 5 Stocks Save Lives, Fund Retirements

Brett Owens, Chief Investment Strategist
Updated: July 24, 2020

Quick income quiz—what’s the longest running bull market powering dividend payers? It may be the multi-decade run in healthcare spending.

Dividend stocks that are providing products aligned with this megatrend have the types of payouts that we’re looking for in a retirement portfolio:

  1. Secure cash flows, with
  2. Rising profits to support future dividend growth.

At a time when we can no longer take dividend payments for granted, this type of “megatrend support” is becoming a must-have.

We’ll talk specific stocks in a minute. First, let’s get into the trend and spend. The Centers for Medicare & Medicaid Services provides estimates of US health care spending by sources of funds, such as private healthcare insurance, Medicare and so on.… Read more

One Step for “Crash Insurance,” 3X Your Dividends

Michael Foster, Investment Strategist
Updated: July 23, 2020

Here’s a critical mistake anyone can make while hunting for big dividends in a market like today’s: you can buy the right stocks at the right times—and still lose money!

2020 is a good example: even though the S&P 500 is back now positive on the year, you almost certainly suffered some degree of the following wipeout, no matter which stock you would have bought at the start of 2020:

The Headache of Going All in on Stocks

Ask anyone and they’ll likely say the market has been totally unhinged this year; bulls will say stocks shouldn’t have fallen as far as they did in March, and bears will say they shouldn’t have recovered so quickly.… Read more

Dogs, Drugs and 208% Dividend Gains

Brett Owens, Chief Investment Strategist
Updated: July 22, 2020

I lifted my mask a bit so that my old office neighbor could recognize me:

“Hey!” he said. “Saw you and the pup the other day in front of Shake Shack. I remember when she used to sprint down the hallway, and now…”

“Yeah,” I sighed. “It’s tough. Chronic arthritis, or something. X-rays, MRIs and a cocktail of drugs. Poor thing is only eight but acting like she’s going on 18. Anyway, we’re trying everything. What’s new with you?”

“I’m actually trying to take a sabbatical. Get out of here for a while.” He paused. “If any place will take me!”… Read more

Beat Inflation, Grow Your Dividends 10,000%. Here’s How.

Brett Owens, Chief Investment Strategist
Updated: July 21, 2020

If you’ve read my articles in the last few weeks, you may have noticed I’ve been writing about inflation more lately. I’m doing so because your income portfolios—especially your bonds!—are at risk as a result of recent money printing.

My recent monetary focus has taken many readers by surprise. After all, we haven’t seen sustained inflation in 40 years. Nothing like a four-decade lull to lure an investor into a false sense of “60/40 retirement portfolio” security!

But even though we’re staring at day-to-day deflation right now, with lockdowns hitting demand for most products beyond the essentials, make no mistake: the ingredients for inflation are there.… Read more

My Crisis-Investing Strategy for 7.1% Yearly Dividends (forever)

Michael Foster, Investment Strategist
Updated: July 20, 2020

This crisis has hit income-seekers—particularly retirees—hard. After the stomach-churning March selloff came the slashing of “sacred cow” dividends, like those of senior-care providers Ventas (VTR) and Welltower (WELL).

Look to Closed-End Funds for Retirement Income

It’s understandable (and healthy!) if the past few months have made you extra cautious when picking dividend stocks. The good news on the dividend front is that you can still find plenty of high, safe payouts in my favorite corner of the high-yield market: closed-end funds (CEFs).

CEFs are a great pick for retirement income today, for three reasons. First, they still give you access to large-cap stocks you know well: mainstays like Visa (V), Apple (AAPL) and Johnson & Johnson (JNJ) feature in many equity-CEF portfolios.… Read more

5 Dangerous Dividends for a “Bathtub-Shaped” Recovery

Brett Owens, Chief Investment Strategist
Updated: July 17, 2020

Let’s keep our heads and our dividends above water in this crazy year that is 2020. Most income investors know that it’s been brutal for dividends. But do you know how horrific it’s actually been?

Our pal Howard Silverblatt of S&P Dow Jones Indices has slapped an official number on it:

$42.5 billion.

That’s how much cash U.S. stocks cut or suspended their dividends by in the second quarter alone. We haven’t seen pay cuts this steep since Q1 2009, when investors received $43.8 billion less in cash distributions than the year prior.

This wasn’t just a couple of large dividend programs tanking, either.… Read more

How a 15% Dividend Dream Turned Into a Nightmare

Michael Foster, Investment Strategist
Updated: July 16, 2020

With the S&P 500 yielding just 1.8%, and 10-Year Treasuries paying a pathetic 0.7%, many folks are getting desperate for income—and they’re falling for dangerous dividends like exchange-traded notes (ETNs).

Note I said “ETN” here, and not “ETF.” It’s a critical distinction—and overlooking it could cost you a fortune in gains and dividends.

A Crippling 70% Loss

To see how dangerous ETNs can be, consider the (now defunct) UBS Etracs Monthly Pay 2x Leveraged Closed-End ETN (CEFL), which I first warned readers about in October 2017. CEFL went on to be crushed by the S&P 500 from that first warning until the start of 2020.… Read more

Jay Powell is Powering This 5.2% Dividend Higher

Brett Owens, Chief Investment Strategist
Updated: July 15, 2020

Fed chair Jay Powell is our kind of income investor. He’s allocated up to $750 billion to buy individual corporate bonds. Perhaps Jay is sick of being told what to do, because he (like us!) is clearly on a mission to help his central bank retire comfortably on dividends.

He realizes that US Treasuries don’t have the oomph he needs. As I write, the 10-year bond pays less than 0.7%. If Jay had tossed his $750 “billies” into T-Bonds, they wouldn’t even net him a “lame” $5 billion annually.

Instead, our man hired investment firm BlackRock to buy ETFs like the iShares iBoxx High Yield Corporate Bond ETF (HYG).… Read more