This 6.5% Dividend Loves a Market Meltdown

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The Contrary Investing Report > NYSE:BDJ

Today I’m going to give you a strategy—and a strong 6.5%-yielding fund—that both shine when the market throws a tantrum.

And both are way better than what most people do when things get rough: cash in.

Many studies have shown that trying to time the market simply doesn’t work. And even if you did have the superhuman ability to get in and out perfectly, you’d still underperform a buy-and-hold approach. Thanks to compound interest, keeping skin in the game is more important than trying to save your skin.

Options: Your (Surprising) Friend When Markets Roil

Instead of fruitlessly trying to time the market, we’re going to do something that actually works (and takes far less effort!).… Read more

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I get lots of pushback when I post an article panning exchange-traded funds. ETF fanboys (and girls) base their love on two things: ETFs’ cheap management fees and convenience, because they let you jump into an entire sector in one click.

My response? Handle these so-called “set it and forget it” plays with a lot of caution—or risk a big dent in your savings.

Getting What You Pay For

Far too many ETFs (like the four I’ll reveal below) are cheap for a reason: lousy returns! Worse, some aren’t even cheap—like my “second-worst” pick below, which charges an outrageous 2.1% fee and has no one at the helm at all.… Read more

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Right now, there are 2 fears giving first-level investors night terrors (and costing them huge gains and income).

  1. Rising interest rates will kill stocks, and…
  2. Nosebleed valuations (along with more record highs for the S&P 500) will kill stocks.

The problem? Both are nonsense!

Let’s take the second one first—then we’ll push on to 4 buys that not only survive rising rates but soar faster than rates do!

A Painful Wait on the Sidelines

Sure, the market’s current P/E ratio looks scary at around 23, and that alone could keep you clear of stocks now. Trouble is, sitting in cash isn’t exactly comforting as stocks rise and inflation chews up your nest egg.… Read more

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Almost every investor has a built-in bias that causes them to miss out on significant gains. It’s 100% predictable, easy for us to profit from and is running rampant in the markets today.

In just a few paragraphs, I’ll show you 2 funds that are perfectly positioned to profit from it, with one yielding an incredible 11.4%.

Before I get to that, let me explain.

The flaw in human nature I’m talking about is called recency bias. Don’t let the wordy name fool you: it just refers to the tendency people have to assume something will happen again, just because it happened in the recent past.…
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Legendary investor and Berkshire Hathaway (BRK.B) CEO Warren Buffett recently gave us an insight into the type of dividend-paying fund he’d invest in if he could:

“Our aversion to leverage has dampened our returns over the years. But (partner Charlie Munger) and I sleep well. Both of us believe it is insane to risk what you have and need in order to obtain what you don’t need.”

“Leverage” stands out because it’s a common tool used among several high-yield classes, from mortgage real estate investment trusts (mREITs) to business development companies (BDCs). Even closed-end funds (CEFs) – which some investors turn to for relative safety versus individual stocks given CEFs’ diverse portfolios – can sport high leverage of between 30% and 60%.…
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Don’t be cheap when you buy bonds this holiday season (or ever, for that matter). Bargain shoppers, sadly, tend to be the most at-risk of outliving their fixed income portfolios!

But it’s easy for you and me to double up “regular” bond returns simply by swapping out popularity for quality.

Let’s walk through some of the most popular fixed-income plays today – and replace each with something that yields more (with superior price upside to boot).

The obsession with fees is understandable. Most investors are conditioned by their experience with stock-based mutual funds and ETFs to search out the lowest fees, almost to a fault.…
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