Don’t become complacent with your dividends! Your portfolio and your income are at the whim of Fed Chair Jerome Powell—now more than ever.

I realize he’s acting like a “good boy” at the moment. But what if JP decides to go rogue again and exercise his independence? A surprise rate hike would be catastrophic to many income portfolios.

That means you need to “Fed-proof” your nest egg and your dividends. Today we’ll discuss four funds paying dividends up to 10.7% that do just that.

These four closed-end funds (CEFs) have been left for dead in this market rally. That makes them great “Fed insurance”: they’re cheap, so they’ve got built-in upside if the rally goes into overtime.… Read more

If you want to diversify, get a strong—and growing—dividend and dodge risky speculation, the SPDR S&P Dividend ETF (SDY) may seem like a no-brainer.

But buying this fund would be a huge mistake!

Today I’m going to show you why, and help you avoid a couple other seemingly obvious moves that could steer you into big trouble. Further on, I’ll reveal a terrific fund paying an outsized monthly dividend (yielding 7.9%) to buy now and tuck away for two decades or more.

First, back to SDY, which has beaten the S&P 500 over the past decade:

SDY Throws Us the Bait …

At the same time, the fund has shown solid dividend growth, as well as some massive special dividends that have helped its payouts grow substantially over the years:

… and Sets the Hook

So why not just buy this fund and call it a day?… Read more

The Fed poured cold water on its growth outlook this week, all but taking the possibility of a 2019 interest rate hike off the table.

Following reports of slower growth in China and Europe in recent months, the FOMC lowered its U.S. growth outlook for 2019 and 2020 on Wednesday, to 2% and 1.9% respectively.

Chairman Powell also said that U.S. economy was falling short of inflation targets and the Fed’s internal projections for two rate hikes in 2019 fell to zero.

The move came almost three months to the day that the FOMC unanimously (and controversially) raised interest rates, sparking a massive wave of selling last December.… Read more

Almost every corner of the market is overpriced today. That includes dividend stocks, which cost too much and yield too little.

The S&P 500 is at multi-year highs in almost every valuation metric: P/E, P/B, P/S … you name it. And a lot of that froth is coming from traditional income sectors. Yardeni Research’s latest sector study shows that utility stocks, for instance, trade at 18 times estimates, at the very high end of its 10-year range. The sector’s typically high yields, meanwhile, have dried up to a mere 3%.

Hey! Where’d the Dividends Go?

The real estate industry is getting pricey, too, with the iShares U.S.… Read more

Today I’ll show you how I helped investors sidestep a “silent” payout cut in a popular closed-end fund (CEF). We’ll also look at how to approach this fan fave today—and how this tale can help us keep our nest eggs (and income!) safe.

Calling Out the Cool Kid

I’m talking about the PIMCO Dynamic Income Fund (PDI), which I flagged nearly two years ago, when it was at the height of its fame thanks to its outsized 9% dividend yield.

Even though first-level investors couldn’t get enough of PDI, I fired off a warning flare, writing that its massive 8.4% premium to net asset value (NAV, or the value of the corporate and government bonds and mortgage-backed securities it held) was under threat.… Read more

Many retirees like the idea of a “50/50” portfolio that’s half bonds and half stocks. There’s even research that shows withdrawal rates of 3% and 4% may be safer with this mix than they’d be with 100% stocks.

That’s all well and good but doesn’t concern me much. I’m a “No Withdrawal” guy. I spent many late nights in college working up Monte Carlo simulations, where we’d run scenarios 50,000 times to figure out the optimal placement of, say, ambulances in a city to minimize the average response time to an emergency. This type of fancy modeling can work well when you’re able to use the law of large numbers to map the likelihood of every possible situation.… Read more

Don’t be fooled: imitating the picks of famous stock pickers is a road to retirement ruin.

I get it: gurus like Warren Buffett, Dan Loeb and Ken Fisher are the cream of the crop.

Too bad the big cash wads these guys toss around limit them to the lamest dividend investments. And you can bet almost all of them are missing out on one stock that’s paying a lucky group of investors an incredible 32% dividend!

Let’s dive straight into why following the pros’ lead is a big mistake. Then I’ll give you three ridiculously cheap stocks to grab for massive dividends—before their prices take off into the stratosphere.… Read more

It’s a question that’s absolutely critical when judging a closed-end fund: how safe is the dividend?

This is particularly crucial when you consider the huge yields the average CEF offers compared to their ETF cousins. For the 2,918 ETFs available to US investors, the average payout is 1.9%, partly because 735 of these funds pay nothing at all. But even without those, the average ETF yield is still a pathetic 2.5%.

CEFs? For the over 450 covered by my CEF Insider service, the average yield is 7.3%, and only nine yield less than 1%. In fact, over 85% of CEFs yield more than 4%, while just 9% of ETFs do!… Read more

U.S. Markets rebuffed negative headlines from around the globe this week, bouncing back from losses suffered earlier in March.

Boeing (BA) lost 11% combined over Monday and Tuesday, following a second tragic crash of its 737 MAX airplane that led to a global grounding of more than 300 of the company’s jets. The decline single-handedly accounted for a loss of more than 300 points on the Dow Jones Industrial Average in 48 hours.

The discussion if, when and how Brexit will proceed continues to play out across the pond, without a resolution. Theresa May lost a second vote in Parliament on Wednesday; and then the decision for the U.K.… Read more

Stephen chose a precarious time to buy. He purchased a REIT right before the sector’s ensuing rout. But it didn’t matter because he knew exactly what to buy. He banked an easy $91,405 on this investment while most first-level REIT investors sweated and treaded water.

Park Hotels & Resorts (PK) was a relatively new REIT that was spun off by Hilton Worldwide (HLT) at the beginning of 2017. Director Stephen Sadove, around this time last year, bought 9,600 shares of his own firm – right before REITs sank in an epic rout that soon unfolded.

The “dumb” REIT index VNQ was soon dumped in unison by investors.… Read more