Did you know that over 36% of US publicly traded REITS either cut or slashed their dividends during the pandemic?

This combination of dividend cuts and demand from yield-hungry investors has led to bottom-of-the-barrel yields across the industry.

The Vanguard Real Estate ETF (VNQ), which is a solid proxy for the REIT market, now pays only a 2.2% dividend yield, well below historic averages.

It shows the importance of finding high-quality, well-managed REITs that can sustain their dividend payments, even in the throes of a financial disaster.

I’m here to tell you that despite the dividend cuts, there are still plenty of attractive high-yielding REITs out there. … Read more

Double-digit dividends are rare. A sky-high yield of 27.2% is an outright income unicorn.

Only in the merry world of closed-end funds (CEFs) would we see such a tale. It’s enabled by talented money managers who, thanks to wide investment mandates, serve as the Willy Wonkas of the CEF factory.

These managers have an endless bag of tricks at their disposal. They can put options to work. They can “double down” on their own bets. They can double, triple and even quadruple the yield on traditional investing strategies, leading to average yields in the high single digits and stretching all the way to 27.2%.… Read more

If you’re not holding at least some of your portfolio in international dividend stocks, you’re missing out.

Stocks (and funds) in some overseas markets pay higher dividends than US companies. The 60 biggest stocks on Canada’s Toronto Stock Exchange yield 2.5% right now, for example, compared to a 1.3% average yield for the S&P 500.

What’s more, plenty of US investors are (in many cases unintentionally) biased toward their home country, with more than three-quarters of their portfolios, on average, invested in the US, according to recent numbers from Franklin Templeton.

To a degree, that’s understandable—after all, America has the world’s biggest and most dynamic stock markets, boasting dominant big cap firms such as Pfizer (PFE), Ford Motor Co.… Read more

I had just spent my whole paycheck at Whole Foods. My wife was not amused.

“Brett,” she paused and trailed off, a telltale sign that I was in the hot seat.

“You don’t have to buy everything organic. Some stuff…” she searched for words, shaking her head.

I flailed for a life raft: “But isn’t organic good?”

“Some fruits, sure,” she conceded. “And vegetables. But not all of them. Like avocados, and bananas—they have thick skins, so it really doesn’t matter if they are organic or not.”

“And cookies. Cookies are a highly processed food. Why are you bothering with organic?”… Read more

Fed Chair Jay Powell’s overheating money printer has been great for our portfolios—it’s sending our dividend stocks through the roof! But where the heck do we invest new-found gains for further payouts?

I know I don’t have to tell you that this inflated market has clobbered dividend yields (as yields move in opposition to prices), but there are still bargain-priced dividend payers out there, some throwing off recession-proof payouts yielding over 6%!

Last week, we talked about one “Fed-fueled” corner of the market—energy stocks like ExxonMobil (XOM), payer of a gaudy 6% payout itself. It’ll thrive as inflation climbs, driving up oil prices.… Read more

I’m hearing from a lot of dividend investors suffering from “bull-market blues”: while stocks have soared, driving up their portfolios’ value, they’re stuck on what to do with their gains—because stocks have soared (and yields have plunged)!

It’s a vicious cycle that doesn’t look like it’ll end anytime soon, and it’s even hit what are traditionally the most overlooked corners of the market.

Take my favorite high-yield investments, closed-end funds (CEFs), which regularly offer huge yields of 7% or more. CEFs invest in all sorts of things, from energy to utilities to corporate bonds and US stocks. And by and large, they’ve gotten pricey, too (but there are still some deals to be had in the space, as we’ll discuss shortly).… Read more

There is a massive desire for consumers to get back to traveling. If you’ve been to an airport lately, the only big change is that people are wearing masks; the crowds are on par with pre-pandemic levels.

And while workers are still enjoying the WFH benefits, when it comes to leisure activity, there is a huge desire to get out of the house and spend on experiences.

Although leisure travel has rebounded nicely, business-related travel has lagged behind; technology- hello Zoom (ZM) – has helped displace a lot of the expensive and often unnecessary travel expenses.

The newer wrench into the situation comes from the Delta variant, which CDC officials say is now as contagious as the Chicken Pox.… Read more

Don’t get me wrong—I love my kids. It’s just that I’ve loved “hidden yields” longer.

What are these long-term affectionate affairs of mine? These under-the-radar dividends require looking at the bigger-picture view of all the cash a company is spending on you and me. Sometimes it means looking past a low current yield and instead focusing on rampant dividend growth that will mean big income down the road.

But sometimes, that simply means looking where everyone isn’t—like five little-known stocks yielding a cool 7% on average that we’ll discuss today.

The Virtue of Hidden Stocks

To understand the power of investing in the relatively unknown, consider this quick story from a good friend of mine:

Used-car prices have skyrocketed over the past few months.… Read more

We talk a lot about discounts and dividends in our CEF Insider service. And they’re critical, of course. The need for a high dividend is obvious, especially if you’re in or near retirement. And buying a CEF at a big discount to net asset value (NAV) can slingshot us to serious price gains.

But being too focused on one number, be it the discount, the dividend or an individual stock’s P/E ratio, is what renowned contrarian Howard Marks calls “first-level thinking.” To get to the real truth of whether an investment is worth buying, we need to go deeper.

Of course, we contrarians know this.… Read more

As dividend yields and interest rates dropped in recent decades, income investors looked for ways to generate cash flow from stocks. Selling (“writing”) covered calls is one strategy that has gained attention.

It is certainly a conservative options strategy that most income investors think they should do. The math is compelling.

Here’s how it works. We would buy a dividend stock like Exxon Mobil (XOM) for its $0.87 per share quarterly payout (a 6% yield). Then we would write a covered call with a “strike” price just above the stock’s current level.

For example, XOM trades below $60 as I write.… Read more