How to Buy Yields up to 12% for Pennies on the Dollar

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How to Buy Yields up to 12% for Pennies on the Dollar

As contrarians, we search for income stocks that vanilla investors hate. Today there are not many dividend deals left. No surprise, with the market levitating since last October.

But! When we expand our search to CEFland, we do find a few closed-end funds (CEFs) left at the bottom of the bargain bin. Today we’ll discuss five that pay between 5.7% and 11.7% and trade at discounts between 12% and 18%.

In other words, these five CEFs trade for 82 to 88 cents on the dollar. Let’s explore whether each dividend is “cheap for a reason.”

General American Investors (GAM)
Distribution Rate: 5.7%
Discount to NAV: 18.4%

General American Investors (GAM) is a straightforward large-cap CEF that holds “companies with above-average growth potential.”… Read more

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Buy The Dip? Cool … But This 8.2% Dividend Almost Never Dips

Seriously. Alerian MLP ETF (AMLP) pays a dividend that is now a sizzling 8.2% (read: eight-point-two). Plus, the fund raises its payout regularly. It dishes 12% more today than it did twelve months ago!

As a result, AMLP is so popular that investors keep the price up!

Seriously, check out this quarter-ending stock price chart. AMLP’s quote may drift for a quarter, or two, max. That’s why any meanderings lower are great buying opportunities:


Source: Income Calendar

AMLP is up 19% since we added it to our Contrarian Income Report portfolio just over a year ago. Despite this stellar performance by an income stock, it may indeed be the one missed by most plain-vanilla investors.… Read more

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Did You Miss the Rally? 5 Still-Cheap Dividends Up to 12.3%

Mr. and Ms. Market are manic. Always have been, always will be. My fellow contrarian, they reminded us of this fact yet again.

Fortunately we were zigging while the broader crowd was zagging.

The herd’s “FOMO panic” last week pushed many of our stocks higher. Vanilla investors covered their ill-timed short positions and scrambled to buy bargains. Like the dividend deals we bought in October!

Did you miss out? Have cash suddenly burning a hole in your pocket? If so, no worries, a few select dividend deals remain.

I’m talking about yields up to 12.3% and discounts up to—get this—46%.… Read more

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Jay Powell’s Hands Are Tied – This 9.6% Dividend Directly Benefits

Looking to profit from oil-powered dividends? Look no further than this discounted payer dishing 9.6%.

Oil prices had plunged in recent months on recession fears. However, there’s still no recession. Oops. One point for the energy bulls.

Meanwhile, OPEC said enough “cheap” oil. On Sunday the cartel announced production cuts. Oil prices popped.

Will OPEC’s move prompt the Federal Reserve to raise rates even higher to cool demand for oil? I don’t think so because the Fed has a problem. It broke the banks! Higher rates could do more damage.

High oil is painful, but a banking crisis is worse.… Read more

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2 Ways to Play the Coming Oil Surge for 9% Dividends

All of my indicators are telling me that oil is getting set to rip higher. And when it does, we’re going to be ready with two funds throwing off outsized 9% dividend yields!

How can I be so sure the goo is a coiled spring? Well, for one, the two underrated oil funds we’ll discuss below trade at huge discounts to their “true” value. Right now, we can buy them for less than 90 cents on the dollar.

That gives our oil gains an extra boost. And if oil does break lower from here—something I see as highly unlikely—we’re still getting some nice downside protection, thanks to those very same discounts.… Read more

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This Dividend Stock Pays 5.7%, Can Return Another 79%

These 5.7% and 8.9% dividend payers are ready to rally.

Whether they pop this year or next, we shall see. It’s a matter of when rather than if—which is what we gladly sign up for as income investors.

The broader stock market appears to be on a near-term sugar high. Crypto is going (a bit) crazy and meme stocks (of all things) are back. Count us careful contrarians cautious!

We instead turn our attention to natural gas—a market that has already corrected.

Remember when “natty” prices were supposed to go to the moon this winter? We feared that Europe, without Russian gas imports, would be in for a long cold season.… Read more

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These 8%+ Dividends Could Fall Hard in a Recession

Members of my CEF Insider service and I always look for big dividends we can collect for the long haul. I’m talking 8%+ payouts here, many of which come our way monthly. (This is possible with CEFs, and these funds’ discounts to net asset value, or NAV, give us some nice upside to go along with those payouts).

By thinking long term, we give our CEFs’ discounts the time they need to close, propelling their share prices higher. (There are exceptions to this, however, such as with covered-call CEFs, which do better when markets are volatile—we tend to swing in and out of these as volatility ebbs and flows.)… Read more

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5 Ways to Invest in Oil (Ranked From Worst to First)

When oil spikes, like it has in recent months, many folks get tempted, wondering if there’s a way to time their way into—and out of—crude for maximum profits and dividends.

Unfortunately, timing markets is tough—especially the oil market, which is global and highly complex. Heck, the experts have trouble doing it! Consider this chart:

Bloomberg analysts looked at how the price of energy commodities trended over the last 20 years and how an index of energy-related investments performed over the same period. They found that professional investors whose job is to turn changes in commodity prices into cash profits had a hard time doing so.… Read more

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3 Ways to Tap Rising Oil Prices for 8%+ Dividends

If you’ve sat out oil stocks until now, it’s easy to think you missed the boat. After all, oil’s big run has sent shares of producers (and pipeline operators) soaring. That’s meant lower dividend yields—and higher valuations—for folks who decide to tiptoe in now.

But there’s a way we can “turn back the clock” and squeeze 8.1%, 8.7% and even 8.9% dividends out of energy stocks. (These are the actual yields on three overlooked funds I’ll show you in a moment.)

Those are the kinds of yields you could only get back in April 2020, in the teeth of the COVID crisis, when oil stocks were on their backs, their depressed prices sending their yields soaring.… Read more

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2 Top Oil Buys for 2022 (8% Dividends, 7%+ Upside Ahead)

Today we’re going to dive into two closed-end funds (CEFs) that have what everyone is on the hunt for these days—massive yields! Both pay more than 8% on average and tempt us with big upside, too, as they’re far cheaper than most other CEFs.

Let’s stop there for a second and talk a bit about CEFs: they’re a small group of funds known for their high yields (averaging around 6.8% across the board currently). They’re like ETFs in that they’re diversified, with each CEF typically buying hundreds of assets within a specific investment strategy.

Unlike ETFs, though, CEFs often trade for less than the actual market value of the assets inside the fund.… Read more

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