3 “Preferred” Dividends for Secure 6% Yields

Brett Owens, Chief Investment Strategist
Updated: December 8, 2016

If you could earn 5% to 6% in income every year from a stock you don’t have to watch … you’d hold it today, right?

Well, if you don’t already, here’s your wake-up call.

Preferred stocks are a rarely talked about type of corporate equity that packs a one-two punch of high yield and low volatility. But that’s not why they’re called “preferred” – that moniker comes from the fact that preferred dividends take priority over common shares’ dividends, and must be paid out first. If a company wants to cut or suspend its payouts, it must do so to common shares before preferred shares.…
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4 Tax-Free 10%+ Yields With 38% Upside

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

The last time this happened, municipal bonds soared 40% over the next 12 months.

These usually-steady payers are coming off their worst month since September 2008, according to Standard & Poor’s, when its “muni” index dropped 4.8% (and popular funds fared even worse):

The Last Muni Bloodbath in Sept 2008…


October 1, 2008 didn’t mark the bottom for munis. But it turned out to be a pretty good time to buy, with these funds returning up to 38.4% in the ensuing 12 months!

… Gave Way to This 12-Month Muni Boom


Those were scary times. The financial world was melting down, and prominent pundits feared that municipalities would be the next wave of defaults.…
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Buy These 2 Cheap Dividend Payers Before Yellen Raises Rates

Michael Foster, Investment Strategist
Updated: December 6, 2016

On the lookout for safe dividends? (Who isn’t, right?)

These days, you generally have three options: large-cap stocks with long dividend histories, municipal bonds and US Treasuries.

Treasuries are considered the safest of that group, and large-cap stocks the riskiest, but they’re still much safer than plenty of other investments, such as small caps and junk bonds.

I’ll show you two low-risk investments that are great buys now in a moment. But first, I want to tell you why recent events have called the safety of some of the options I just named into question.

Let’s start by looking at the following chart:

“Safe” Assets Turn Volatile


First, note how the iShares S&P National AMT-Free Municipal Bond Fund (MUB), a good proxy for municipal bonds as a whole, is the least volatile of the three funds shown above.…
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Forget the December Rate Hike: Buy These 4 Dividend Growers Now

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

Still think the Federal Reserve may not hike rates this month?

It’s time to change that view.

Traders betting through the Fed futures market now see the odds of rates staying where they are at a measly 1.4% after strong employment and consumer confidence numbers last week.


And if you’ve tried to take out a mortgage lately, I don’t have to tell you which way interest rates are headed: no thanks to a spike in 10-year Treasury yields, which hit a 17-month high last week, you’re now paying more than 4.0% on a 30-year mortgage.

Borrowers Get Mauled


So, time to hold off on dividend stocks, then, right?…
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2 “Trump-Proof” 6% Yielders to Buy Now

Michael Foster, Investment Strategist
Updated: December 2, 2016

There’s no doubt Donald Trump’s election win has been great for stocks.

Municipal bonds? Not so much.

In the last month alone, “munis” have lost over 3% of their value—a huge decline for an asset class that’s supposed to be safe and stable.

So is it time to sell your munis, give up on safe income and try to ride the Trump rally in stocks?

No way. In fact, if you’re just thinking of doing that now, you’re probably too late.

The Trump rally reversed course after Thanksgiving, with a down day that threw a damper on the stock market’s post-election euphoria.…
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3 REITs With Big Insider Buying

Brett Owens, Chief Investment Strategist
Updated: November 30, 2016

First-level investors mistakenly think that real estate investment trust (REIT) profits will be hurt if rates rise. In three instances, they’re dead wrong – and missing out on big, secure dividends with upside to boot.

At these REITs, top insiders – who of course know better than armchair observers – are currently buying up their own shares like crazy. While corporate insiders may sell stock for many reasons, they only buy because they believe the payout is safe and price is likely to rise.

In the short run, the “rates up, REITs down” theory puts on quite the show. If you hold REITs in your portfolio, I can tell you how it’s trading (up or down) on any given day by considering only one number: the 10-Year Treasury Rate.…
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3 “Dark Horse” Dividend Stocks Primed for 30% Gains in 2017

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

Today I’m going to share three of my favorite dividend stocks from an ignored corner of the market set to soar in President Trump’s first year.

Which corner? The “little guys”: small and mid-cap stocks.

In many ways, the cat’s already out of the bag. As they’ve done with financial stocks, investors have bid up small- and midcaps since Trump’s win. Look at the how the SPDR S&P 600 and the S&P Midcap 400 have performed vs. the S&P 500:


That’s a huge gap … and it makes sense. With the US dollar soaring and Trump threatening to toss trade deals in the shredder, the market’s small fry (which tend to be more domestically focused) are in the catbird seat.…
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4 Dividend Stocks You Need to Sell Now

Michael Foster, Investment Strategist
Updated: November 27, 2016

It’s a classic death spiral.

I’m talking about the flight to dividend-paying—and dividend-growing—stocks in the past eight years.

It’s easy to see what triggered it: US Treasuries don’t offer pay enough to cover inflation, and despite President-Elect Trump’s inflationary policies—more on those below—that won’t change anytime soon.

That’s prompted income-starved investors to pile into higher-yielding options, like municipal bonds, utility stocks, corporate bonds and dividend-growth stocks. These are all good choices, of course.

But here’s where the death spiral comes in: the rush into these investments has dragged down their dividend yields (because you calculate yield by dividing the annual dividend by the current share price), sending investors into even riskier areas of the market.…
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The 3 Best Dividend Growth ETFs for 2017

Brett Owens, Chief Investment Strategist
Updated: November 25, 2016

When you invest for the long haul, dividend stocks and exchange-traded funds (ETFs) are going to be the bedrock of your portfolio.

The idea is simple: The slow crawl higher of the market over time, plus a few percentage points of return each year in income, will be enough to push your nest egg to that magic number you need to enjoy a comfortable retirement.

Just a couple of problems with that, though.

The age-old adage is that you can expect about 7% annual returns from the stock market, and when investors plan for the future, that’s the number they plug into their calculations.…
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5 Trump-Proof Funds Paying Up To 7.3%

Brett Owens, Chief Investment Strategist
Updated: November 23, 2016

Donald Trump has income investors scrambling for rate-hike (and even inflation) insurance. Fixed yields are out, while floating yields – which adjust higher in tandem with rates – are in.

Even if you’re skeptical (as I am) that we’ll see rates continue meaningfully higher anytime soon, inflation insurance is never a bad thing provided that:

  1. It pays a decent current yield (sorry, gold).
  2. We can buy it at a fair price.

The sudden popularity of “floating rate” issues may have you rightfully wondering whether or not this trade is already too crowded. Fortunately, my preferred vehicle for buying them is currently out of favor itself!…
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