How to Get a 9.4% Yield From Your Favorite Dividend-Growth Stocks

Michael Foster, Investment Strategist
Updated: November 11, 2016

It may sound crazy, but if you were to invest $1 million in the S&P 500 right now, you’d generate just $1,750 in monthly income.

That’s just barely above the poverty line for a family of three.

When that much capital fetches such a pathetic amount of income, something’s wrong.

You came blame the Federal Reserve and its ultra-low interest rates. Or a retirement system that has thrown Americans to the wolves, replacing defined-payout pensions with 401(k)s that are too often designed to take—rather than grow—your savings with absurdly high management fees and low returns.

In such an environment, our parents’ retirement strategies just don’t work anymore.… Read more

5 Dividend Growers That Are Finally Bargains

Brett Owens, Chief Investment Strategist
Updated: November 9, 2016

With the S&P 500 recently off a 9-day losing streak – its longest since 1980 – this is a great time to go shopping. Especially for dividend growers.

These special types of stocks are rarely cheap, because who doesn’t want yield AND upside? But general market jitters about the Fed, the election and the economy have presented us with some early holiday bargains.

Let’s start with five stocks that have traded up over the last three months while the broader market dipped 3.7%. Price strength amidst market weakness is an admirable trait. It can be worth asking yourself why investors and money managers are buying these particular stocks while they dump the rest of their portfolios in a panic.… Read more

5 High-Yield Funds to Buy Before the Fed Hikes Rates

Michael Foster, Investment Strategist
Updated: November 8, 2016

Today I’m going to show you a crystal-clear, highly predictable market pattern we can cash in on—and 5 safe, high-yield funds we can use to do it.

It’s all thanks to the Federal Reserve’s cat-and-mouse game with interest rates.

Let me explain.

Now that we’re past the days of quantitative easing boosting stocks, investors’ attention has shifted back to rates, with a quarter-point rise in December looking more likely after last Friday’s strong jobs report.

Fears of a rate hike pulled the rug out from under stocks, including six straight days of declines at the start of November. The financial press has fanned the flames with doomsayer headlines that have amped up investors’ panic.… Read more

Best Dividend Growth Stocks to Buy in November

Brett Owens, Chief Investment Strategist
Updated: November 7, 2016

If you’ve read my columns on Forbes and Contrarian Outlook, you know my heart belongs to dividend-growth stocks.

The reason is simple: dividend growers outperform every other kind of stock there is.

But don’t just take my word for it. Study after study backs that up, including an exhaustive one by Ned Davis & Associates that zeroed in on the 43-year period from January 1972 through December 2014.

Here’s what they found:


It’s tough to argue with those numbers—especially over a period spanning nearly half a century!

But as I wrote last week, you can’t just run out and buy an exchange-traded fund like the Vanguard Dividend Appreciation ETF (VIG).Read more

How to Generate $112,000 in Retirement Income From a $500,000 Portfolio

Brett Owens, Chief Investment Strategist
Updated: November 5, 2016

Today I’m going to show you an easy way to use the S&P 500 Dividend Aristocrats—companies that have hiked their dividends for 25 straight years or more—to build a durable income stream you can retire on.

But before I do, there’s something I need to tell you about these 50 companies, which are “sacred cows” in many investors’ eyes: the fact they’re in this exalted club today doesn’t mean they will be in the future.

Consider ExxonMobil (XOM), a long-time Aristocrat that’s losing money fast and may be forced to slash its payout.

I know I don’t have to tell you what investors who are relying on XOM’s 3.6% dividend would do if their quarterly “paycheck” suddenly dropped in half.… Read more

3 Recession-Proof REITs With 20% Upside in 2017

Brett Owens, Chief Investment Strategist
Updated: November 4, 2016

What a difference three months makes.

Back in the summer, real estate investment trusts (REITs) were all the rage—especially after a dismal May jobs report put the final nail in the coffin of a summer rate hike.

Fast-forward to today, and we’re looking at a rate hike that’s a 72% certainty at the Fed’s December meeting, according to traders betting through the Fed funds futures market:


It’s no coincidence that the air has gone out of the SPDR Dow Jones REIT ETF (RWR), a popular REIT index fund, as that late-year increase has grown more certain:

RWR’s Big Rise—and Fall


It’s a classic case of the herd falling for an old myth: that REITs underperform when interest rates rise.… Read more

How To Live Off $500,000 Forever

Brett Owens, Chief Investment Strategist
Updated: November 2, 2016

A half-million dollars is a lot of money. Unfortunately, it won’t generate much income today if you limit yourself to popular investments.

The 10-year Treasury has “rallied” to 1.85%. Put your $500K in them and you’re well below the single-person poverty level at $9,250 annually. Yikes.

Dividend paying stocks are masquerading around as bond proxies for this reason. But they still don’t yield enough. Vanguard’s popular Dividend Appreciation ETF (VIG) pays 2.1%. The iShares Select Dividend ETF (DVY) pays 3.2% – better, but that’s still just below the poverty level for two people at $16,000 per year.

When investment income falls short, retirees sell their investments to supplement the income.… Read more

4 Popular Dividend ETFs You Need to Dump Now

Brett Owens, Chief Investment Strategist
Updated: October 31, 2016

I hate to say it, but right now, thousands of investors are putting their portfolios on autopilot right when they need to take control the most.

I’m talking about the boom in “passive” investing, or bypassing stock picking and plowing your cash into low-fee exchange-traded funds (ETFs) instead.

Some income-starved investors are going further, piling into ETFs that hold stocks with either above-average yields or strong dividend growth.

A Brilliant Strategy … Until It Isn’t

In theory, it’s a smart move. After all, companies that pay—and better yet regularly hike—their dividends have a history of outperforming stocks with no payout at all.… Read more

Sell These 6 mREITs Immediately

Brett Owens, Chief Investment Strategist
Updated: October 28, 2016

Real estate investment trusts (REITs) are an important component of a high yield portfolio for retirees or aspiring retirees. But there is one group of exotic, tantalizing REITs that must be avoided: mortgage REITs. Especially today.

These so-called mREITs often offer high dividend yields—as high as 14% in some cases! That alone should tell you something is amiss. Unfortunately many investors get seduced by these short-term income streams, leading them straight into the arms of disaster.

What’s so bad about mREITs? Plenty, really. Let’s start with the income issue. mREITs are notorious for having uneven payouts, which means you cannot expect the next dividend to be higher or even the same as the one from last quarter or last month.… Read more

3 Infrastructure Stocks To Buy Before Election Day

Brett Owens, Chief Investment Strategist
Updated: October 26, 2016

No matter who wins the November election, infrastructure stocks should get a bounce. We’ll talk best plays in a minute – but first, let’s recap the rhetoric.

Clinton says she’ll push for a five-year $275 billion plan that, with loans and leverage, would total up to $500 billion. Trump says he’ll double that.

Of course I wouldn’t buy any stock based on a politician’s promise alone. But many industrial companies pay yields at the high end of their historical averages. Some are compelling values, especially when you consider that the global manhunt for yield has driven most payout percentages down near multi-year lows rather than highs.… Read more