Two 16%+ Dividends That Look Too Good to Be True (and Are!)

Michael Foster, Investment Strategist
Updated: February 13, 2020

If you’re like most income investors, you stop in your tracks when you spot a massive payout—like 16% or more. A yield like that means you’re doubling the market’s historical annual return in dividends alone.

What’s not to like?

Too bad dividends that big are almost always warning signs. That’s the case with the two stocks we’re going to dive into today. You’ll want to avoid their “siren song” 16%+ payouts now—or sell if they’re taking up space in your portfolio.

When the Market and Reality Part Ways

This story actually starts more than a decade ago—in the middle of the collapse of 2008.… Read more

How Grandma Turned $387K Into Dividend Income for Life

Brett Owens, Chief Investment Strategist
Updated: February 12, 2020

A financial friend of mine, an income-focused money manager, called me to brag about one of his clients. He’s used his CIR subscription to smartly help her turn a modest $387,000 nest egg into monthly dividend income that’s on track to last, well, just about forever.

Three years ago, he explained how he was using my “retire on monthly dividends” strategy to help this nice grandmother.

“She brought me $387,000,” he told me originally. “And wants to take out $3,000 per month for ten years.”

Well, so far, so good for grandma. She’s now 38 months into her $3,000 per month dividend gravy train.… Read more

The Secret to Safe 7% Dividends (with Upside) in 2020

Brett Owens, Chief Investment Strategist
Updated: February 11, 2020

I’m annoyed with this bubbly stock market. It’s making it nearly impossible for regular people to find decent dividends.

Sure, we’ll always take upside, and despite overdone drops due to the coronavirus, the market has handed us a 4% total return since the New Year, building on the 31% it delivered last year.

But where the heck do we invest our gains?

Truth is, if you want to deploy cash into higher payers, you’re in for a tough slog: the S&P 500 yields just 1.7% today, a low we’ve only seen a couple times since the financial crisis.

US Stocks Rarely Pay so Little

Treasuries?… Read more

This 1 Simple Move Could Turn $100K Into $474,800

Michael Foster, Investment Strategist
Updated: February 10, 2020

It’s a tired piece of “wisdom” you hear from personal-finance gurus over and over: you need to invest in low-cost, passive index funds to get the highest return.

Too bad it’s completely false!

Today we’re going to look at how obsessing over fees can actually cost you tens of thousands of dollars. Then I’ll name a fund that could get you big gains and pays a dividend north of 6%. What’s more, this unusual fund, a closed-end fund (CEF), to be specific, gives you that steady cash payout while holding some of the biggest stocks out there—I’m talking about household tech names like Apple (AAPL) and Amazon.comRead more

Buy at These Highs? No Thanks – 4 Cheap Dividends Instead

Brett Owens, Chief Investment Strategist
Updated: February 7, 2020

If you’re an income investor like me, these stock market all-time highs are pure misery. Fortunately, I have a fix, which I’ll explain in a moment.

High stock prices mean low yields for new money, which unfortunately minimizes dividend potential. Plus, buying overpriced stocks limits upside potential, too.

Why reach for a 2% yield when you could lose that in an overnight trading session?

Cheap dividend stocks are a rare breed right now. But there are a few bargains left, and not because they are risky. These misunderstood shares are the last bastions of dividend value remaining on the board today.… Read more

These 15 Funds Crush Their Index (and Pay 7% Dividends, Too!)

Michael Foster, Investment Strategist
Updated: February 6, 2020

You’ve probably heard that less than half of active funds beat their index, and a low-cost index fund is your best bet for long-term investing.

Well, today I want to show you why that is 100% wrong. I’ll also reveal 15 funds paying dividends from 5.6% to 7%, while crushing their index, too.

First, the facts.

When it comes to mutual funds, it’s true that the vast majority of them do not beat their indexes. It’s also true that most funds of all types that invest in common stocks don’t beat their index.

But there’s more to investing than stocks. Much more.… Read more

Late Cycle Investing: Dividend Stocks for 2020 and Beyond

Brett Owens, Chief Investment Strategist
Updated: February 5, 2020

Until a flu-like virus emerged halfway around the world, it’s been three peaceful months since we’d seen a “1% up or down day” in stocks. As usual, the volatility inspired investors to reflect upon the advanced age (almost eleven years) of our current bull market.

To paraphrase the legendary rock band Chicago, does anybody really know what time it is in the rally right now? “Late cycle” is a popular guess. But how late?

Did the streetlights just pop on, or is it 2am with money managers stumbling into their taxis and Ubers outside?

Most rallies don’t make it to eleven, but then again, most don’t follow financial crises either.… Read more

How to “Inoculate” Your Portfolio From Coronavirus (and Get 6%+ Dividends)

Brett Owens, Chief Investment Strategist
Updated: February 4, 2020

I’m sure you’ve noticed stocks whipsawing in the past week on fears of the spreading coronavirus. We’ll talk income investment strategy shortly, with a specific focus on safe dividends and profits, regardless of where the markets go from here.

First, I should say that I’m not going to go into the health or political implications of this outbreak, which has infected thousands as I write this, with 99% of those in China.

As investors, we need to look at the situation through a clear, logical financial lens. And the good news is that right now we have a great opportunity to safeguard (and even grow) our nest egg—and our dividend income, too.… Read more

How to Buy Microsoft for 8.6% Off (with a 6% dividend!)

Michael Foster, Investment Strategist
Updated: February 3, 2020

There’s a dangerous myth going around: that stocks are in a bubble, and if you buy now, you’ll lose money.

This myth is dangerous because it is discouraging people from putting money in one of the most powerful wealth-generating machines on earth. And income-seekers (retirees, in particular) who know how to navigate this market can not only get massive profits but also strong cash flow, like the 6% dividends, paid monthly, on a fund I’ll introduce you to shortly. This fund is worth your while because it’s a play on US stocks at a time when stocks are strong and getting stronger, and because it’ll get you those stocks at an 8.6%… Read more

These Bear-Repellent Stocks Yield 6% to 11%

Brett Owens, Chief Investment Strategist
Updated: January 31, 2020

The stock market is driven by greed and fear. And when the latter takes full control of the wheel, as is the case right now, value-minded income investors need to stay sharp.

It’s been more than a decade since we’ve gotten a true bear market, which tends to bring stock valuations more in line with historical norms. Even so, since 2009, we’ve experienced a few quick drawdowns that resulted in more reasonable prices, and more generous yields, than this expensive market typically offers.

There was the August 2014 correction triggered by China’s “Black Monday.” There was our near-bear experience in 2018, prompted by tariff fears, Fed rate hikes and the partial government shutdown.… Read more