Why US Stocks Will Beat the World in 2025 (This 8.1% Payer Will Lead)

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Why US Stocks Will Beat the World in 2025 (This 8.1% Payer Will Lead)

It looks like 2024 will end with a big gain for investors in US stocks, with the S&P 500 up 28% year-to-date, even better than my (admittedly optimistic) expectations: I saw a roughly 15% gain for the S&P 500 going into the year.

If this gain holds, 2024 will go down as one of the best years in the last 20, with only 2013 and 2019 doing (just slightly) better.

However, unlike those years, the momentum isn’t coming mainly from tech, with the benchmark Technology Select Sector SPDR ETF (XLK) actually trailing the market, with a 24.5% return year-to-date, as of this writing.… Read more

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This 7.3% Dividend Can Be Your Very Own “Wealth Manager”

I know that plenty of our readers are self-directed investors who love nothing more than to build—and run—their own portfolios. Digging into a fund’s prospectus and annual reports is something they look forward to.

But if you’re like many people, you look to a wealth manager to oversee at least some of your investments for you, or at the very least help with things like tax optimization, financial planning and setting up an estate plan.

There are, however, a few things we need to bear in mind when selecting one. For starters, while many wealth managers can help their clients set up a program that puts them on a path to financial independence, the reality is that wealth managers face intense competition, and that can provide a temptation among less-experienced ones to cut corners.… Read more

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Markets Are About to Get Choppy (This 8% Dividend Is Here for It)

I get it if you’re a bit wary of this latest market rally: We’ve got a volatile (to say the least!) election now days away. And while the Fed says rates are headed lower, there’s still a lingering uncertainty about where, exactly, they’ll land.

While a bit of anxiety is understandable, we do not want to make the same mistake many “vanilla” investors do at times like these: go all into cash.

For one, humans are terrible at predicting the future—remember those warnings of a 100% chance of a recession in 2023?—so safe to say a good number of today’s investment worries are unlikely to come to pass.… Read more

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This 3-Click “Mini-Portfolio” Holds Stocks and Bonds (and Yields 8.1%)

Having a diversified portfolio is pretty much Investing 101, right?

I mean, it’s one of the first things we all learn as investors. But there’s a problem here: Going for balance in “regular” stocks, bonds or ETFs can mean leaving income on the table.

To see what I’m getting at here, check out the average yields on two ETFs many people buy for stock and bond exposure. For stocks, I likely don’t have to tell you about the SPDR S&P 500 ETF Trust (SPY). It’s the popular S&P 500 tracker. And it yields a microscopic 1.2%.

There are plenty of options on the bond side, but let’s go with a fairly high-yielding ETF, the SPDR Bloomberg High-Yield Bond ETF (JNK).… Read more

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Why “High” Fees Could Pay Off When You Buy These 8%+ Dividends

When choosing between closed-end funds (CEFs), you might be tempted to put a lot of focus on fees. That makes sense. Nobody likes high costs eating into their returns.

But there’s more to CEF performance than just the expense ratio, and if you focus on buying the funds with the lowest fees, you might leave a lot of money on the table.

Because the truth is, there’s no clear relationship between fees and long-term returns. A CEF’s portfolio and the skill of its managers play a far greater role in determining its success than fees alone.

Breaking Down the Data: No Simple Relationship Between Fees and Returns

Let’s start with the data.… Read more

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This 1-Click Buy Crushes the 60/40 Portfolio, Pays 8% in Cash

Just a week ago, I wrote to you about the dangers of investing in a tired investor go-to called the 60/40 portfolio.

You know the one—the so-called “rule” that you should invest 60% of your holdings in stocks and 40% in bonds to reduce your overall volatility.

But investing this way—according to arbitrary standards like 60/40—is a recipe for leaving money on the table, especially when we’ve got a terrific way to get a much bigger dividend stream from stocks, which we’ll get to in a moment.

Your Odds of Long-Term Profits in S&P 500 Stocks? 100%

I’m coming back to this topic so soon because I recently read Ben Carlson’s fantastic analysis of the 60/40 portfolio.… Read more

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This Simple Mistake Could Kill Your Profits in a Market Rally

With stocks again on the upswing after the August 5 pullback, the appetite for risk is back!

Rising markets are terrific, of course. But they do bring dangers. One is that they might tempt some people to abandon sound long-term investing and take a stab at more speculative approaches, like day trading.

Before we go too far into whether you can actually make a reliable return from day trading, I’d say that to be a successful day trader, you should be aiming to beat the market … and a lot of ink has been spilled about how active managers—and I’d include individual investors here—can’t do that on the regular.… Read more

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2 Big Dividends to Buy When Stocks Plunge (and an 8.7% Payer for When They Soar)

In last Thursday’s article, we talked about one of my favorite “low-drama,” high-paying investments—I’m talking 7%+ payouts here.

Those would be covered-call funds, which we look to in times of higher market volatility, which we’ve seen recently and I see as more likely as we move toward year end. At times like these, covered-call funds are a good option, as their option strategy cuts their volatility and boosts their income. Check out that article for our full breakdown of how this works.

Today we’re going to go one step further and delve into how these funds fit into your portfolio. We’ll also talk tickers.… Read more

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Why Our Top 8%+ Payers Are Soaring (With More Room to Run)

We’re a little more than halfway through the year now, so it’s a great time to check the state of play on our favorite high-yield plays: 8%+ paying closed-end funds (CEFs).

And what a half-year it’s been: CEFs have posted returns far bigger than most people expected back in January! And I see more gains ahead.


Source: CEF Insider

Truth is, the hundreds of CEFs tracked by my CEF Insider service are turning up some fascinating data, especially if we zoom into the CEF Insider Equity Sub-Index (in brown above), which has returned 12% year to date, as of this writing.… Read more

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Forget Treasuries: These 7%+ Dividends Are Much Safer

Don’t believe anyone who tells you there’s such a thing as a safe investment. Truth is, every asset—from Treasuries to houses to dividend stocks—involves risk.

The “safest” investment, according to the Financial Industry Regulatory Authority (FINRA), is a short-term US Treasury bill. You lend the government $100, say, and you’ll get $105.17 back in a year. Not bad.

But there are some caveats:

  1. Short-term Treasury rates fluctuate, and the Federal Reserve has said they’ll try to get them lower later this year.
  2. In a truly apocalyptic disaster, you might find that the Federal Reserve doesn’t pay your money back. In fact, you might find that money itself is worthless.

… Read more

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