SEC Yield Calculation (and Why It’s Better Than TTM Yield)

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SEC Yield Calculation (and Why It’s Better Than TTM Yield)

“Hey Brett. How’s the weather out there in California?”

My usual reply is “warm and sunny.” Simple. Gives the asker what they expect and keeps the pleasantries moving along.

If I was one for small talk, I would be tempted to mix in a confusing and way-too-detailed response. Like this:

“The weather? Well, Sacramento hit a low of 27 degrees in the early morning hours of February 24. And we cooked at an extreme 116 degrees on September 6. It has been quite the 12 months!”

Twelve months? Who cares about 12 months? Well, bond funds do.

Last week, we highlighted the iShares 20+ Year Treasury Bond ETF (TLT): “It (TLT) boasts a 4.1% yield and has some serious upside potential.”… Read more

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2 Big Dividend Hikes Set to Drop Soon (Tickers Revealed Below)

Now is the best time to roll out our favorite dividend “hack.” It’s a sneaky-smart strategy that lets us “time” the market for soaring dividend payouts (and a steady drip of price gains, too).

Our plan consists of two simple steps, which we’ll look at now. Then I’ll name two stocks that are perfect for this strategy. Both look set to roll out big dividend hikes soon.

Step 1: Buy Just as a Payout Hike Is Announced

We’ll start by “timing” our buys just as dividend hikes are announced. That’s a veteran move because a company’s stock almost always rises with its payouts—a predictable pattern I call the Dividend Magnet.… Read more

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Forget the Dividend Aristocrats: This “3-Click” Portfolio Yields 10.5%

Despite last week’s market pop, there are still plenty of terrific dividend buys out there. But don’t waste your time with lame payers like General Mills (GIS), with its 2.7% yield. Or the miserly 2.2% you get from a so-called “Dividend Aristocrat” like McDonald’s (MCD).

Inflation is still at 7.7%! That’s far ahead of these pathetic blue-chip yields. We just can’t afford to own low payers like these any longer.

We need much more income if we want to achieve the dream scenario: a retirement funded entirely by dividends. That’s the path we’re going down today, with three closed-end funds (CEFs) boasting an incredible average yield of 10.5%.… Read more

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These Steady REITs Yield 3x-4x the Market

Real estate investment trusts (REITs) are retirement makers right now. Many are paying dividends that are three or even four times the market average.

Plus, these landlords are cheap. They are trading at multiples of cash flow that make them bargains compared with the S&P 500.

Why are these deals available? Rising rates.

In the near term, higher rates mean higher costs of capital for REITs, and more competition for income (as bond yields rise, too). That has knocked real estate stocks down—which is great news for us dividend investors, because it means they pay more.

Today, we’re going to look at a surprising three-pack of REITs that yield 3x to 4x the broader stock market and are outrunning not just the sector over the past few months, but the much better-performing S&P 500.… Read more

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Rethink What’s Working and Snag 15%+ Annually

Every Thanksgiving, I get together with my in-laws. They’re nice enough people … but if I’m being honest, some of them aren’t particularly interesting.

Conversations are invariably limited to just two or three topics. In fact, some people just have two or three particular stories they trot out.

I just sit there and nurse my second or third glass of wine, and try to look interested.

The stock market is kind of like that in 2022. There simply aren’t a lot of things to say about the stock market – rising rates and inflation have gutted Big Tech and other growth-oriented names, while commodity stocks and defensive plays reign supreme.… Read more

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Everyone Has Missed This Amazing 95-Year-Old Fund (Which Yields 9.8%)

Let’s use this November rally to “front-run” even bigger gains in 2023. Our target buys: closed-end funds (CEFs) yielding 10%+ and trading at double-digit discounts.

We’re keen to move now because, with a 20%+ loss this year, stocks (and the CEFs that hold them) are way oversold. And with the market’s tendency to rise into year-end (the much-loved Santa Claus rally), now is a great time to buy.

One smart option here is a CEF called the General American Investors Company (GAM), payer of a 9.8% dividend. GAM is one of the most reliable CEFs there is, with roots stretching back to 1927.… Read more

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These Safe Bonds Pay 4.2%: Buy Before 2023 Recession

One week ago, money-printer-turned-inflation-hawk Jay Powell told the world he was going to keep hiking interest rates. And more than he thought his Federal Reserve needed just two months ago.

Yes, even higher interest rates. Obviously more bad news for bonds, right?

It depends. Let’s explore the second level take, because Jay’s outlook is actually bullish for a select slice of fixed income.

Our inspiration, as always, is renowned value investor Howard Marks, chief of Oaktree Capital Group, with $164 billion under management. Marks’ writing has won acclaim from legendary peers such as Joel Greenblatt, Jeremy Grantham, Seth Klarman and even Warren Buffett.… Read more

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This 64%+ Dividend-Growth Opportunity Comes Every 4 Years (It’s Open Now)

We’ve finally got something (two things, in fact!) working for us dividend investors in this dumpster-fire market:

  • The midterm elections, which always bring a buying opportunity (as we’ll see below) and …
  • The calendar, as stocks post most of their gains in the six months starting November 1.

The last time this “double-profit” setup appeared, after the 2018 midterms, we tapped it for a 57% return. That win was driven by a payout that grew quarterly.

Now we’ve got a chance to pull off the same feat again—with the same ticker we used then, too! This kind of opportunity is very rare indeed—only appearing once every four years.… Read more

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Powell’s “Press Conference From Hell” Has Made These 10% Dividends Cheap

Jerome Powell’s latest trip before the microphone has opened up a surprising opportunity for us dividend investors.

I have three funds for you that are deeply discounted in the wake of the Fed chair’s press conference last week, following the release of the latest rate decision. Buying this trio now also sets you up for dividends ranging from 9.7% to a stunning 12.5%.

Before we get to them, let’s set the stage by zeroing in on exactly what happened last Wednesday, from the time the Fed’s decision and seemingly dovish statement were released until after Powell was finished speaking at the following press conference.… Read more

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Time to Buy the Bottom in These 8%+ Yields?

As contrarian income seekers we buy when yields are high and prices are low. Today, we’re going to explore a three-pack of dividend funds that pays 8.5%.

This is “retire in style” income. We put a million dollars in these plays and get paid $85,000 per year. Plus, we keep our principal intact.

And wait, there’s more. The cheapest of these three funds is currently trading for just 89 cents on the dollar. Yes, that’s an 11% discount to the value of its underlying holdings.

Too good to be true? Or bottom-fishing bargain? Let’s explore my preferred dividend strategy and these three dividend machines.… Read more

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