The S&P 500 is near record highs. The pundits see an elderly bull market with more room to run. The Federal Reserve says it will likely hike interest rates multiple times in the next 12 months.

Sound familiar? It should. Because it’s exactly what we were as 2016 dawned.

Here’s what happened in the following six weeks:

I know what you’re thinking: Yes, but the index did go on to recoup those losses and more, with big rallies following the Brexit vote in June and Donald Trump’s surprise win last month. In the end, it wound up the year with a 10.1% rise.… Read more

It’s been a great year for high-yield bonds. If you’ve held them during 2016, congratulations.

But if you’re like me, you’re probably wondering whether to keep holding or take your profits and invest them somewhere else.

That’s the question I’m facing with a high-yield bond fund that has gone up over 22% since my purchase.

To decide what to do, I first want to look at how the asset has performed relative to alternatives. The leading index for this asset class (the Bank of America Merrill Lynch US High Yield B Total Return Index) has risen 17% in 2016:

High-Yield Bond Index Soars

Meanwhile, the S&P 500 has gone up 13% in the same period, including dividends:

Stocks Doing Well, Too

Of course, no one will be crying themselves to sleep at night for getting “only” 13%, but it is less than high-yield bonds paid out.… Read more

When you think of emerging markets, what comes to mind? Growth opportunities are likely first on the list … followed ever so closely by stomach-churning volatility.

What you probably don’t think about is income. But even in EMs, investors can dredge up some considerable dividend yield.

We all know the basic emerging market investment thesis: These “emerging” countries typically feature much more robust economic growth and quickly expanding middle classes. As a result, the companies there are expected to rapidly grow as they both feed off that greater economic pie, and as their operations become international in nature, building revenues around the rest of the world.… Read more

I’m sick of hearing people worry about the Federal Reserve raising interest rates.

The mainstream media and the market go into panic mode when they fear rates are going up. I’m hearing more worries about a major stock correction coming in 2017. Since Janet Yellen’s interest rate hike, the market has taken a dip—and the trend is worrying:

The Rally Is Over

Investors are losing faith in the Trump rally, and many people are anticipating more declines to come. The Fed said it’s going to raise rates three times next year—and each rate hike is expected to drive more investors out of the stock market and into safer and better-yielding US Treasuries.… Read more

Looking for cheap stocks throwing off double-digit dividend hikes in 2017?

Bad news: it’s getting tougher to dig up these hallowed companies—and easier to fall victim to a dividend cut.

Consider the S&P 500, the be-all-and-end-all for most people when it comes to stock picking.

According to FactSet, 44 of the index’s constituents had payout ratios (or the percentage of earnings headed out the door as dividends) that were above 100% in Q3. That’s nearly 9% of the index, the second-highest total in a decade.

Not good.

Meantime, the S&P 500’s average payout ratio hit 40.2% during the quarter, the highest level in seven years.… Read more

2016 has been a crazy year—so it’s no surprise closed-end funds (CEFs) have been offering crazy returns.

As we’ll see in a moment, the best fund is up over 50%, which crushes just about every unleveraged ETF and mutual fund out there. Plus, that fund pays a whopping 7.6% yield—which is pretty typical for CEFs. If you bought in when it was at its 52-week low, you would have been getting an unbelievable 14.7% yield throughout 2016, while also seeing your portfolio’s market value go up and up.

This is the power of getting into the right CEF at the right time, and it shouldn’t be ignored.… Read more

The 10-year’s yield up to 2.6%? Big deal – you and I still aren’t retiring off it!

Hence the appeal of closed-end funds (CEFs), which often pay 8% or better. That’s the difference between a paltry minimum-wage income of $26,000 on a million bucks in capital, or a respectable $80,000 annually.

And if you’re smart about your CEF purchases, you can even buy them at discounts and snare some price upside to boot!

Unfortunately this rising rate environment has income seekers scared of CEFs. Many of our Contrarian Income Report subscribers are writing in to ask if they should bail on our high paying vehicles.… Read more

Warren Buffett’s done it again.

Don’t look now, but year-to-date, Berkshire Hathaway (BRK.A, BRK.B) stock is up 25% and is actually outperforming the incredible 20% a year, on average, it’s returned since 1964.

A Chart Any Investor Would Love

In a moment, I’ll show you an overlooked investment that lets you duplicate the moves of the world’s smartest investor—and you won’t have to buy a single share of Berkshire Hathaway to do it.

In fact, you’ll be able to pick up Berkshire and the companies it invests in for 19% less than you’d pay on the open market!

A Banking Boost

Berkshire’s year-to-date gain has come, in part, thanks to the financial industry’s recovery post-election.… Read more

If you’re cutting back on stocks because interest rates are rising, you’re making a mistake.

But don’t just take my word for it (after all, I am a dyed-in-the-wool dividend-stock fan). Ask Ned Davis Research, which released its latest research on the relationship between stocks and rates about a year ago.

The finding? When the Fed moved slowly on rate hikes, stocks dropped immediately after each announcement … but went on to gain 10.8%, on average, in the next 12 months.

And as I’ve mentioned before, when Ned Davis’s researchers took a longer view—from January 1972 through December 2014, a period that saw far faster rate hikes than we’ll likely see this time around—they found that dividend growers outshine any other kind of stock, and not by a little.… Read more