This Steady 14% Dividend Will Crush Stocks Well Into 2025

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This Steady 14% Dividend Will Crush Stocks Well Into 2025

Stock market predictions, of course, are just that—predictions. All of them (including mine!) should be taken with a grain of salt.

I normally prefer to avoid making them. But every now and then I partake because, well, the prediction game is fun! And we do need some kind of forecast to work from when it comes to buying stocks—and our favorite income plays: 8%+ yielding closed-end funds (CEFs).

The key, of course, is knowing when to stick to your forecasts and when to change tack. So as we move past the August 5 correction and toward the final third of 2024, it’s a good time to check in on a couple predictions I made back in January and see how they’re playing out.… Read more

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Big Payouts, Lousy Returns: Avoid These Funds (Yielding Up to 8.9%) in ’24

Here’s the thing about high-yield closed-end funds (CEFs): sometimes a CEF will seem to have all the earmarks of a terrific investment: high (and monthly) dividends, reasonable fees and reputable management. But it’ll still come up short.

We, of course, love CEFs and see them as the critical pieces of our income portfolios. The portfolio of my CEF Insider service, for example, holds plenty of top-quality buys and yields 9% as I write this.

But when picking these funds, we need to make sure we don’t let a big name, high yield or so-called “low” fees dominate our thinking. We also need to look deeper, at factors like past performance and even management’s track record with its other funds.… Read more

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This 9.8% Dividend Could Fund Your Retirement for Decades

We’re facing a “2016-like” moment in bonds these days, meaning anyone who buys now has a shot at locking in 10%+ dividends for decades—and a shot at price upside, too.

I mention 2016 now because, back then, something truly unusual happened: interest rates on bonds jumped in a short period of time, driving the payouts on high-yield corporate bonds to nearly 10% at their peak:

Rates Drop, Soar, Drop, Soar Again

As you can see above, anyone who bought a high-yield bond in 2016 locked in a 10% cash flow. Many of these bonds continued paying out interest without a hitch, even through the pandemic, a time when yields spiked again, giving investors another chance to buy bonds at another huge interest rate.… Read more

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This $7-Trillion “Cash Wave” Is Set to Pour Into These 10%+ Dividends

We’re in a weird time where interest rates are at (or at least near) a peak—but most people haven’t realized it yet. When they finally come around, one group of closed-end funds (CEFs) is likely to soar (and pay us double-digit dividends, too).

I’m talking about bond funds, and the “double-digit dividends” part is already well underway, with yields on some corporate-bond CEFs held by my CEF Insider service breaking over 12%. (An added bonus: most bond CEFs pay dividends monthly, too.)

By the way, it’s not just me talking here: it’s the world’s biggest asset manager, a firm that, due to its sheer size and deep research resources, has access to next-level insight no one else can compete with.… Read more

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A 13.4% Dividend to Consider as the 10-Year Takes a Breather

Rising rates have sunk bond prices—and sent their yields higher.

The upshot? Now is a good time to add high-quality corporate bonds to your portfolio. And if you do so through one closed-end fund (CEF) we’ll name in a second, you’ll be able to do so with a 13.4% dividend that grows.

To be honest, bonds have already started to rise, and we’ve been taking advantage in my CEF Insider service. In October, for example, we picked up the Nuveen Core Plus Impact Fund (NPCT), which yields 11.3% today. We’ve grabbed a 6.8% return so far, including one dividend payout of 10 cents a share.… Read more

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Sell These 4% Bonds by 2022 (Buy These 8% Bonds Instead!)

“Junk” bonds have never paid so little. Which makes them pointless. We’re here for the yields, not the credit quality!

Fortunately we can improve our dividends and our safety by being smarter. We are going to simply sell the popular 4%+ bonds and replace them with better 8%+ yielding equivalents.

First, the dogs. Anyone who owns either of the two most popular high-yield bond ETFs is a sad income investor today. Their yields are at all-time lows. The SPDR Bloomberg Barclays High Yield Bond ETF (JNK), for example, pays only 4.3%:

JNK’s Current Yield is Junk

And it gets worse, because this trailing yield looks better than the year ahead.… Read more

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3 Ignored Funds With 8.2% Dividends (Paid Monthly)

Let’s shrug off today’s “dividend desert” and do something most folks think is impossible—ridiculous, even. We’re going to replace our monthly salary with a huge income stream from a group of closed-end funds (CEFs) that yield 7% or more (sometimes a lot more!).

The math here is simple: at a 7% dividend, you’ll have just shy of $3,000 ($2,917, to be precise) flowing into your account every month on a $500K investment. And yes, these dividends do flow your way monthly, right in line with your bills.

These CEFs have been paying these dividends for years, in some cases decades. And there are plenty of them, too: my CEF Insider service tracks 117 CEFs yielding over 7% and paying out every month.… Read more

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2021 Midyear Report: The Best (and Worst) Dividends to Buy Now

It’s mid-2021, and stock prices are up, dividend yields are down, and you’re probably wondering what the heck to buy for a decent income stream as we thunder toward 2022.

It’s a head-snapping reversal from where we were a year ago, which makes now the perfect time to step back and plot our next dividend moves.

So let’s piece together our game plan for the rest of the year—and into 2022—by ranking five popular (and not so popular!) investments known for income from worst to first. You’ll find many individual tickers to put on your list here, too—including one yielding a healthy 6.8% today.… Read more

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This Unusual “Index Boomerang Effect” Can Generate 95% Gains in CEFs

Most people don’t realize this, but there’s a simple, two-step way to grab serious gains in high-yield closed-end funds (CEFs).

I call it the Index Boomerang Effect. And when I say it’s simple, I’m not kidding around.

It goes like this: over time, we can expect a CEF in a particular asset class to perform around as well as the index that represents it (though to be honest, the best CEFs tend to beat their indexes handily, which makes our strategy even more powerful).

But even the best CEFs do lag their indexes from time to time. The key is to spot those times and buy—then ride your CEF to strong gains as the index “pulls” its share price higher.… Read more

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This Unusual “Dividend Merger” Could Deliver a 9.2% Payout

Three of the most successful closed-end funds (CEFs) in history have done something unprecedented—both for the funds themselves and the company that manages them. They merged.

PIMCO is arguably the most successful CEF manager around, and investors know it: they’ve bid up almost all the company’s funds to premiums to net asset value, or NAV (in other words, their market prices are higher than the per-share value of their portfolios). 

The company has always kept its funds separate, even though they have many similarities, so it came as a surprise when it announced that its PIMCO Dynamic Credit and Mortgage Fund (PCI), PIMCO Dynamic Income Fund (PDI) and PIMCO Income Opportunities Fund (PKO) would be merged into the same fund.… Read more

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