If You Have This Investing “Problem,” I’ve Got the (8.4%-Yielding) Fix

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If You Have This Investing “Problem,” I’ve Got the (8.4%-Yielding) Fix

Sometimes as income investors we face a situation that sounds like a good problem to have: We have to pick among a group of very impressive investments!

That’s obviously much tougher than, say, picking between a stock or fund with a winning record and another with a losing one.

But when you think about the investment choices you’ve made over the years, I think you’ll find that picking between options that seem equally good is actually what you’ve had to do most of the time.

To get into how to make a call when you face this situation, we’re going to use my favorite high-income plays: closed-end funds (CEFs), which routinely yield 8%+.… Read more

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Remember the 2020 Refi Wave? These Wild Dividend Deals Are Even Better

Do not miss these huge dividend yields we’re seeing today. In a year or two, you’re going to kick yourself for not locking these income streams in.

Take it from me. This bond guy nearly missed the great home refi opportunity of 2020-21. Fortunately, I managed to wake up and lock in a 2%+ mortgage before rates skyrocketed. Today, 30-year mortgage rates sit at 8%. Eight percent!

I mention that only because we have a similar setup in dividends today. In a moment, we’re going to discuss an elite dividend paying 8.5%. Let’s not miss it!

From Mortgage Refis to “Dividend Refis”

Here’s the upshot: the same trend that delivered that sweet refi opportunity three years ago is driving our dividend opportunity today—just in reverse.… Read more

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Why Stocks Will Crush All-Time Highs (and the 8%+ Dividends to Buy)

Don’t listen to the bubble worrywarts: even with the 2023 bounce, stocks are well off their late 2021 peak. In other words, they’re still cheap!

Stock Rebound Still Has Room to Run

We can get in even cheaper through discounted closed-end funds. Consider two leading equity CEFs, the Liberty All-Star Growth Fund (ASG) and the Eaton Vance Tax-Managed Diversified Equity Fund (ETY), which yield 7.8% and 8.2%, respectively.

Both deal in blue chips like Visa (V), Amazon.com (AMZN) and Microsoft (MSFT). ASG also adds some lesser-known midcaps for extra growth (hence the “growth” in the name), such as property manager FirstService Corp.… Read more

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Recession? No Recession? This 8.2% Dividend Doesn’t Care

The recession everyone’s been worrying about is still a mirage—and there’s a good chance it won’t become reality for a long time yet. That’s given us a nice momentum play in one closed-end fund (CEF) throwing off an outsized 8.2% dividend.

Here’s what I mean by “momentum” play: the stock market is only now waking up to the fact that the recession appears to be on ice for the foreseeable. Yet at the same time, those recession fears have left us with some terrific discounts in CEFs.

These “delayed reaction” buys—including the ticker we’ll discuss below—won’t last.

I say that because the signs are all there for continued market gains—even if the media is working overtime to tell us otherwise.… Read more

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CEF Return of Capital Explained (Hint: It’s a Benefit, Not a Flaw)

We’ve been getting a number of questions from CEF investors in the last few weeks about return of capital, or ROC.

This is a measure that shows up regularly with CEF dividends—and it makes many folks wonder if their funds are simply handing back the money they’ve invested as part of their payout.

(Note that much of what we’re going to discuss below is tax related. I’m not a licensed tax professional, so I can’t give you tax advice. You should consult a tax professional for details on your own personal situation.)

First, let’s be clear that all CEFs that are publicly traded on US exchanges are actively investing in something, with funds specializing in municipal bonds, real estate, stocks, preferred shares, real estate investment trusts (REITs) and other assets.… Read more

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1 Safe 7% Dividend You Could Hold Forever (and 1 Yield Trap About to Spring)

Imagine two closed-end funds (CEFs) that both yield upwards of 7%. Sounds great, right? Buy a bit of both and get $58.33 per month for every $10,000 you invest. Put in $500K and you’ve got a middle-class income dropping into your account without you having to do a thing.

While that’s a great way to achieve financial independence, we CEF investors know it’s not as easy as searching out a couple of 7% yielders and buying them. We need to go deeper.

While there are over a hundred CEFs yielding 7% or more right now, their quality varies widely. Some are yield traps that will drain your capital with lousy price performance over time, more than offsetting any dividend cash they pay you.… Read more

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“Big Short” Contrarian Has a New Target (you’ll never guess what)

You’ve probably heard of Michael Burry.

Played by Christian Bale in the film The Big Short, Burry famously made nearly a billion dollars betting against the housing bubble in the 2000s.

Now this legendary contrarian has a new target: funds.

He’s mostly panning passive exchange-traded funds (ETFs), but he’s got a lot of disdain to go around. In a recent interview with Bloomberg, Burry said that many funds are forming a bubble that’s getting bigger, whether they’re “open-end, closed-end or ETF.”

As a big fan of closed-end funds (CEFs)—including the top-quality 8.6%-yielder I’ll show you shortly—this comment stopped me.… Read more

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3 Reasons Why Stocks Will Soar (and 2 buys for 8%+ dividends)

When it comes to investing, too many folks ignore the signal and listen to the noise.

Case in point: one of the biggest stories of 2018—a looming trade war between America and China. Lately, the story has mutated into one about a trade war between America and, well, just about everyone—Europe, Asia, Mexico, even Canada!

But this trade war is noise—2018 has been a great year for stocks, and it’s going to get even better. Further on, I’ll give you a couple great ways to cash in.

First, a look at the facts, which are plain for everyone to see … and they clearly prove the naysayers wrong.…
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7 Screaming CEF Buys With 9.3% Yields and 50% Upside

A few days ago, I showed you exactly why now is the time to be greedy—not fearful—when it comes to stocks.

And now, buried deep in the latest gross domestic product (GDP) report is a tiny data point that proves I’m right. It’s the clearest signal in years that now is the time to buy.

I’ll show you 7 funds perfectly positioned to take advantage while handing you safe dividend yields up to 9.3% in just a moment. First, let’s talk about that under-the-radar signal I mentioned.

The report’s headline number showed that fourth-quarter GDP rose 2.1%, slightly above economists’ expectations of 2% growth.

That’s great. But the real exciting news was in the data attached to the press release: corporate profits are up. Way up. …
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