This “Double Discount” Strategy Has Beaten the Market, Yields 8.7%+

Brett Owens, Chief Investment Strategist
Updated: October 20, 2020

My indicators are pointing to one thing right now: higher stock prices, with new all-time highs next year. So this is a great time to lock in some fresh 8%+ payouts—before their prices race away from us!

But wait a minute. The economy stinks and our political process seems more dysfunctional than ever. So why would stocks climb from here?

Money Printer Goes Brrrrr…

The answer lies with Fed Chair Jay Powell’s printing press monetary policy. Since March, he’s been flooding the economy with liquidity. Other central banks around the world have been generous, too.

Powell Goes All In

We both know that printing buckets of money is a recipe for higher inflation.… Read more

This Steady 11.3% Dividend Is Hiding in Plain Sight

Michael Foster, Investment Strategist
Updated: October 19, 2020

If you have $100,000 to invest, you can easily use it to unleash a dividend stream that pays you $940 a month. That’s $11,280 a year in dividends—on just $100K!

I know you’re probably thinking this sounds too good to be true (and you should be!), especially when 10-year Treasuries dribble out just 0.7%, and the typical S&P 500 stock isn’t much better, with a 1.7% yield.

You’re not retiring on either one of those meager payouts!

But $100,000 invested in a fund with an 11.3% dividend yield (like the one we’ll dive into below) gives you a good start toward clocking out, and on a modest nest egg, too.… Read more

3 Dividend Traps Tempting Investors With 8%-10.5% Yields

Brett Owens, Chief Investment Strategist
Updated: October 16, 2020

We can’t take every dividend we see at face value. Especially when we’re talking about 8%, 9% and even 10% yields.

Bull markets, government stimulus, money printing and the scent of all-time highs might give the impression that any stock is safe. Unfortunately that isn’t the case. Even in a bull market, there are dividend traps paying 8% to 10% that’ll sink despite the broader rising tide.

The market might have taken a deep breather earlier this spring, but multiple expansion hardly slept a wink. Thanks to battered earnings, the S&P 500 has only gotten more expensive as the year has rolled on.… Read more

100% Upside, 9% Dividends From Bonds? Here’s How.

Michael Foster, Investment Strategist
Updated: October 15, 2020

These days, you can be forgiven for thinking a wave of bankruptcies is going to hit your portfolio (and your dividends!). But there’s no need to worry: this so-called “wave” is way overhyped—in fact, it could send your portfolio higher.

It’s just one more upside-down thing we investors have to deal with in this crisis.

And get this: you could line yourself up for triple-digit returns (and 8%+ dividends!) if you tap into investors’ (overwrought) bankruptcy fears through a corporate-bond-focused closed-end fund (CEF). I’ll have a ticker (paying a monthly dividend yielding 9.2%) in a moment.

First, let’s dispel one myth: that COVID-19 is behind all the bankruptcies we’re hearing about these days.… Read more

How to Trade 5%+ Dividends for 75% Yearly Gains

Brett Owens, Chief Investment Strategist
Updated: October 14, 2020

Earlier this year, we added Synovus (SNV) to our Contrarian Income Report portfolio. We’ve enjoyed 36% total returns—including a couple of fat dividends—in the six months since. On a yearly basis, these gains annualize to 75%.

“Can we do this every time?” subscribers have asked?

That’s asking a bit much, but it doesn’t hurt to ask. (My young daughters know this well, because they are not shy about asking to eat ice cream at every meal!)

After all, if we reach for 75% yearly gains and have to “settle” for 17.5% profits, we’ll take that. It’s really about the process and stacking the probabilities in our favor on each given dividend purchase.… Read more

4 Stocks Begging Us to Take Their Cash (56%+ Dividend Growth)

Brett Owens, Chief Investment Strategist
Updated: October 13, 2020

Even with the S&P 500 back on the rise, we still have a shot at serious upside. And we’ll double up our dividends in short order, too. We’ll do it by snagging some of the fastest-growing payouts on the planet.

That’s not all—we’ll also buffer our payouts against the next crash by stocking up on companies with “fortress” balance sheets, specifically firms whose cash holdings dwarf their debt. Dividend-payers like these—I’ve got four examples for you below—will (eventually) dole out their cash to us in three ways:

  • Investing in the business,through R&D spending and capital expenditures, fueling their earnings per share (EPS) and, by extension, their share prices.
Read more

These 11% Dividends Have Crashed 43% (They’re Just Getting Started)

Michael Foster, Investment Strategist
Updated: October 12, 2020

You may not know it, but big pension funds are pulling billions of dollars out of one sector, leaving behind a group of stocks these big players will never buy again.

That’s a clear signal that we need to avoid these stocks, too.

I’m talking about oil companies. In New Jersey, for example, legislators are trying to ban the state pension fund from fossil fuels. The state’s Fossil Fuel Divestment Bill has bipartisan support, mainly because oil has been a clear loser for investors. We can clearly see this when we look at the chart of the biggest oil major of them all:

Exxon’s Long Decline

Exxon-Mobil (XOM) peaked at a $500-billion market cap in 2007 and has been in a downward spiral since, pushed lower by the 2014 and 2020 drops in oil prices.… Read more

Earn $60,000 in Monthly Dividends on Just $500K

Brett Owens, Chief Investment Strategist
Updated: October 9, 2020

The mortgage. The car payment. The power bill. The cell phone bill. Your regular dividend check.

One of these things, I’m sorry to say, is not like the others.

While almost every one of your obligations comes once a month across all 12 months of the year, most stocks or funds you can invest in will pay you just four times a year.

If you’re still working, you’re probably thinking “no big deal.” That’s true—your job pays you once or twice a month, so who cares when you collect dividends? You’re not touching your 401(k) or IRA now anyway.

But retirees know the struggle.… Read more

Buy This, Not That: These 7%+ Alternatives Crush High Yielding Stocks

Michael Foster, Investment Strategist
Updated: October 8, 2020

The market’s fall pullback is starting to reverse itself, but don’t worry: there are still bargain dividend payers yielding 7.4%+ dividends to be had out there.

But investing (along with everything in our lives!) has changed. You simply won’t get safe, high payouts by clutching to old habits and buying big-name, high-yielding S&P 500 stocks. The real dividend bargains are in closed-end funds (CEFs), which give you higher payouts, greater safety and often better returns over the long haul.

To show you what I mean, let’s line up three S&P 500 “dividend darlings” against the CEF competition and see how they compare.… Read more

Retire This: 60/40 is Out, These 8% Yields are In

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

It was a simpler time years ago in America when my grandfather shared some nutritional advice with me:

“So, you’ve got the tomato sauce. Tomatoes. They’re good for ya,” as he put out his thumb to indicate the count was now one.

“And the cheese,” he continued. “Dairy. That’s good, too.”

Two fingers on grandpa’s right hand reflected the updated count.

“Plus the bread. That’s another group.”

Three points for pizza being good for you. My 12-year-old self was thrilled! I informed my parents about the good news on our car ride home from grandma and grandpa’s.

“You are not having pizza for every meal,” they quickly dismissed my nutritional news.… Read more