3 Ways to Safeguard (and Grow) Your Dividends as Inflation Ticks Higher

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Inflation worries are everywhere, so let’s dive into what’s behind them—and what we contrarian income-seekers should do right now. The three steps I’m about to show you could hand you a lot of fresh dividend income and price upside, too—even in this (still) overstretched market.

First up—is inflation a real fear right now? Let’s look at the numbers.

Inflation Rises Sharply …

That chart—and shortages of everything from microchips to ketchup—sure seem to indicate that a continued rise in prices is on the way.

But there’s a caveat: this chart compares today’s inflation rate to that of the crushed economy of last year, not to mention those supply-chain issues, which are likely to get ironed out as more of the economy reopens.… Read more

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There’s a “retirement shortcut” far too many people ignore—and it could let you hang ’em up a lot sooner than you think (and with a lot more income, too).

Retirement Investing: Most People Go Wrong at Step 1

When it comes to retirement investing, most folks lean heavily on dividend-paying S&P 500 stocks, particularly those with above-average dividend yields. And if you don’t want to manage a blue-chip stock portfolio on your own, no problem: Wall Street has you covered with the many ETFs it offers.

But this is the wrong route for a number of reasons—the main one being lame dividends!… Read more

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What are we dividend investors to expect in 2021? Let’s look to Washington, DC, where the switch on Jay Powell’s printing press is stuck in “high”:

Money Supply Surges—With No End in Sight

With Powell’s fiat money keeping (what’s left of) the Main Street economy afloat, you can bet that his “instant” cash will keep rolling in. He’ll have a willing partner in incoming Treasury Secretary Janet Yellen, who followed the same strategy when she was Fed chair:

New Boss Same as the Old Boss

This is a recipe for inflation once the economy gets back on its feet. Back in September, we discussed some stocks that make solid inflation hedges by hiking their dividends faster than prices (and inevitably, interest rates) rise.… Read more

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Here at Contrarian Outlook, our beat is income, and we’re often asked for analysis on high-yield ETFs. Today, we’ll look at three funds paying up to 11% (yes, that’s no typo).

I appreciate the ETF popularity. They’re cheap. They’re tax-efficient. They’re  well-marketed. They’ve got cutesy tickers.

But income investors who blindly buy into the hype, unfortunately, are not getting the most dividend for their dollar.

The real dividend deals are found in ETFs’ lesser-known cousins, closed-end funds (CEFs), which often dish even bigger payouts (and a monthly cadence, to boot). CEFs can also trade at discounts to their net asset values, because they fly under Wall Street’s radar.… Read more

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Tech has taken a punch in the face this past few weeks—prompting many readers to wonder if it’s time to sell after booking some big gains in the sector this year.

No way. We’re dividend investors first and contrarians second, so we’re going to take the other side of that bet and buy this tech “mini-dip.” We’ll do it with closed-end funds (CEFs) yielding 7% (and more) that also give us a unique “double discount” to hedge any downside we might see in the coming months (this is 2020, after all) and a good shot at outperforming tech and the broader market, too.… Read more

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Few people realize it, but there’s a way to get big dividends (I’m talking 6%+ payouts) from popular tech stocks—Facebook (FB), Amazon.com (AMZN), Apple (AAPL), Microsoft (MSFT) among them.

I know that when most people hear about tech these days, they immediately think the sector is overvalued. It’s easy to see why: tech is the sole driver of the S&P 500’s gain this year. In fact, when you hear people say the stock market is up in 2020, you might want to correct them and say that, in fact, it’s tech, and not the market as a whole, that’s up.… Read more

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These days, everybody’s looking for the one magic indicator that says when an investment is overbought—or better yet, reveals if it’s a terrific bargain.

Of course, no signal is right 100% of the time, but there is one that gives us the next best thing and unlocks high, “crisis-resistant” dividends, too.

The Perfect Crisis-Investment Indicator (for 7%+ Dividends)

The “bargain alert” I’m talking about is a figure called the discount to net asset value (NAV). And you’ll only find it in a high-yielding investment called a closed-end fund (CEF).

Before we venture too far into financial-jargon land, let’s unpack this, because what I’m about to show you is the simplest, most effective way I know of to grab steady 7%+ dividends and predictable upside in any market.Read more

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Most of us know we need to stay in stocks through this crisis—but some days it’s easier said than done!

Let’s be honest: we could all use a break—a way to hedge against the nasty drops we see when we log into our trading accounts in the morning.

My first suggestion—try not to log into your account every morning! But if you insist on doing so, then my second suggestion is to take a close look at a popular hedging vehicle called a covered-call fund.

Covered-Call Funds: 6%+ Dividend With “Crash Insurance”

Covered-call funds are a kind of closed-end fund (CEF) that holds stocks but gives us an income stream we’d never see from an S&P 500 company—yields of 6% to 10% are the norm among covered-call funds.… Read more

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If you invest in closed-end funds (CEFs) or are thinking about it (and you should be!), I’ve got great news: there’s one simple indicator that tells you exactly when to buy (or sell) these high-yield income plays.

(If you’re a member of my CEF Insider service, you probably know what I’m going to say next.)

I’m talking about the discount to net asset value (NAV), which you can find on pretty well any fund screener. Today we’re going to see how one group of investors rode this simple metric to an amazing 662% in gains and dividends.

Your 1-Click CEF “Buy Alarm”

The discount to NAV is unique to CEFs.… Read more

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Today we’re going to dive into the three best closed end funds of all time. These retirement-changing dividend plays—yielding all the way up to 8.6%!—have not only been crushing all other CEFs, but they’ve been demolishing the S&P 500, as well.

That’s just not supposed to happen!

After all, the pundits are constantly telling us that actively managed funds should not beat the S&P 500, and you’d be better off with a low-cost index fund like the Vanguard S&P 500 ETF (VOO).

But these three CEFs have been crushing VOO for years—and they’re on track to keep doing so.

That’s not all they offer—these funds also pay dividends more than three times higher than the S&P 500 average, boosting your nest egg while giving you a much bigger cash stream than you could ever get from index funds.… Read more

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