Wall Street Hates These 7 High Yields. Should You?

Brett Owens, Chief Investment Strategist
Updated: March 10, 2023

Most vanilla investors like to buy stocks that are well-liked by Wall Street analysts.

This strategy, my contrarian friend, we know is a recipe for disaster.

Why? Well, firms that are already popular with stock jocks have nowhere to go but down. Discarded names, on the other hand, are where the action is because these are the next “analyst upgrade” candidates.

These prices have little downside and lots of upside!

It is difficult to find these out-of-favor plays because most analysts wear rose-colored glasses. They know how their bread gets buttered, and that’s with a bullish outlook.

Which is why a Sell rating is so darned interesting to us.… Read more

What CEF Dividend Cuts Mean (It’s Not What You Expect)

Michael Foster, Investment Strategist
Updated: March 9, 2023

Plenty of CEF investors worry about dividend cuts. And for sure, they’re something to keep in mind. But CEFs are not the same as stocks. When we invest in high-quality CEFs, there are a couple other things we need to remember when we catch wind of a cut:

  1. High-quality CEFs will sometimes reduce payouts by a small amount so they can redeploy capital into oversold bargains. I’ll have more to say on this in a moment, but the upshot is that it holds the potential for us to make more in gains from this move than we lose in dividends.
  2. As mentioned, these cuts are usually small, reducing the yield only a small amount (again, we’ll demonstrate this below).
Read more

3 Bond Funds Walk into a Bar – Best Buy Yields 10%

Brett Owens, Chief Investment Strategist
Updated: March 8, 2023

“Do you have cherries?” my buddy Ralph asked over the phone.

It was January 2021. Sports bars here in California were closed, so we naturally turned our backyard into one.

“No,” I replied. And sighed in an honest admission. “Only beer. Lots of beer.”

“No problem. I got ‘em.”

My buddy also had a mini-keg of delicious old-fashioneds. His creations were dangerously delicious. He’d begun making and aging fine adult beverages to pass time in the pandemic.

And the maraschino cherries he brought played no small role in his cocktail’s critical acclaim.

Is it five o’clock yet? Just kidding (mostly). We are talking about maraschinos in a dividend column because we finally have some bond funds worth cherry picking.… Read more

2 Ways to Play the Coming Oil Surge for 9% Dividends

Brett Owens, Chief Investment Strategist
Updated: March 7, 2023

All of my indicators are telling me that oil is getting set to rip higher. And when it does, we’re going to be ready with two funds throwing off outsized 9% dividend yields!

How can I be so sure the goo is a coiled spring? Well, for one, the two underrated oil funds we’ll discuss below trade at huge discounts to their “true” value. Right now, we can buy them for less than 90 cents on the dollar.

That gives our oil gains an extra boost. And if oil does break lower from here—something I see as highly unlikely—we’re still getting some nice downside protection, thanks to those very same discounts.… Read more

My Advice? Buy These 11.8% Dividends. Retire Early

Michael Foster, Investment Strategist
Updated: March 6, 2023

Do you know how much money you need to retire?

If you’re like most folks, you might think the answer is “too much,” and for good reason. It seems like every day we hear another study or pundit saying we need millions to do so comfortably.

That’s why I was surprised to see a new study out from NetCredit, an online money lender, saying most people would need less than a million dollars to retire. In fact, the company said it’s possible to clock out on just $702,330 in the US as a whole, and in some states even less—like about $470,000 in Mississippi.… Read more

Your Safety Plan Should Start With These ‘Low Vol’ Yields up to 6.3%

Brett Owens, Chief Investment Strategist
Updated: March 3, 2023

With a recession likely at some point, we’re going to focus our attention today on recession-resistant dividend stocks.

With all the talk of a “soft landing” or even “no landing”—the nightmare inflation scenario in which the economy keeps humming—we contrarians are going to take a step back. And respect the yield curve.

In a normal economy, longer-dated bonds would pay more than shorter-dated issues. After all, more time, more things that can go wrong. Which is why you and I are smartly prepping for a recession, regardless of what the latest financial narrative is.

The 10-year Treasury bond has paid less than its 2-year cousin for many months and counting.… Read more

These Amazing Funds “Magnify” Your Portfolio’s Growth (With 7%+ Dividends)

Michael Foster, Investment Strategist
Updated: March 2, 2023

Not many people know this, but you can actually “magnify” the return of a regular stock—just by holding it through a closed-end fund (CEF)!

That’s in addition to getting a much bigger dividend than the typical S&P 500 stock dribbles out: 7%+ payouts are, of course, common in the CEF space.

So how does our CEF “gain magnifier” work?

It comes down to what at first blush seems to be a rather obscure fact: CEFs (which trade on the market, just like stocks or ETFs), generally have a fixed number of shares for the entirety of their lives. That means their market price can be different from their per-share net asset values (NAV, or the value of the stocks they hold in their portfolios).… Read more

An Easy $237,000 in Dividend Income, Missed by Most Investors

Brett Owens, Chief Investment Strategist
Updated: March 1, 2023

Finally, food! The kids had their slices. I had a break in my own conversation. And I was hungry after coaching and refereeing eight periods of second-grade basketball.

I took the opportunity to grab the greasiest slice of Margherita pizza on the tray and folded it like a proper East Coast refugee. And paused.

“Coach Brett?”

“Yeah buddy,” I replied to one of my players, slice still in hand.

“Do you have 40 cents?”

“No, sorry buddy.” I shrugged. And attempted to eat once again.

Then my daughter approached.

“Dad. Do you have 40 cents?”

Forty cents. That was pretty specific.… Read more

3 “Essential” Stocks With Dividends Growing Up to 400%

Brett Owens, Chief Investment Strategist
Updated: February 28, 2023

Food stocks have been hit hard this year—and we contrarian dividend shoppers can no longer ignore the bargains on offer!

Investors’ overly negative take on these “essential” dividend plays makes zero sense because:

  1. They’re partly the result of low fertilizer prices, which can’t last because …
  2. The world needs more food: according to the UN Food and Agricultural Organization, global food demand will soar 70% by 2050, and …
  3. Food supply is tight, no thanks to droughts and Putin’s disastrous war (Russia and Ukraine are the world’s No. 3 and No. 10 wheat producers).

The result? Grocery bills that drain our wallets faster than we can fill our carts!… Read more

This 3-Fund “Instant” Portfolio Could Pay You $70,784 in Dividends

Michael Foster, Investment Strategist
Updated: February 27, 2023

Today we’re going to click our way to a dividend stream that matches the average household income stream in America—$70,784 per year—and we’re not going to do it on a much smaller nest egg than most people think is possible.

This is important now, because the financial media continues to pump out ridiculous answers to the question of how much most folks need to retire. A recent Bloomberg story, for example, said we’d need $3 million saved to clock out comfortably!

Luckily for us that number is way off. Consider this chart:

Source: CEF Insider

Here you see four different scenarios for getting that $70,784 in yearly dividend income, including two Trinity University studies showing risky and conservative estimates, based on 3% and 4% withdrawal rates.… Read more